Criminal landlords and sham letting agents are exploiting a lack of enforcement by councils to create a shadow lettings market, according to new academic research.

The sleuthing was carried out by organised-crime specialists Professor Georgios Antonopoulos (pictured left) and Dr Xavier L’Hoiry (pictured right) and published by the University of York.

In their interviews with enforcement officers and analysis of council cases, they uncovered high levels of criminal activity that they believe have become embedded in the rental system.

L’Hoiry says: “Our report shows distinct patterns of exploitation. We have slum landlords who rent out unsafe or overcrowded accommodation; scam landlords that often illegally convert properties into multiple occupancy or use fake tenancy agreements; and criminal letting agents, who may facilitate illegal activities such as cannabis farms.

At the more extreme end, we have organised crime groups in the rental market that include human trafficking, benefit fraud and modern slavery.”

“At the more extreme end, we have organised crime groups in the rental market that include human trafficking, benefit fraud and modern slavery.  We have criminal connections across the sector that are far more widespread than we expected.”

But, according to their findings, enforcement is failing, with civil penalties and occasional fines having little deterrent effect, and less than 40 banning orders being issued since the legislation was introduced in 2016.

Lack of resources

Councils, the professors say, lack the resources to investigate, so inspections are rare and many offenders simply re-enter the market through shell companies or rebranded agencies. And, although they expect the Renters Rights Act to improve standards, they say it will have a limited impact without adequate funding for enforcement teams.

They are therefore calling for an overhaul of the rules, including stronger regulation of landlords and agents, mandatory pre-let inspections, easier prosecution routes for local authorities and greater use of banning orders and interim management orders.