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Why do landlords lease properties to the government for asylum seekers?

Journalist: Jon Brady, Daily Mail

ended 01. September 2025

There has been a lot of clamouring today over the use of four new-build townhouses in Suffolk to house asylum seekers - but the properties are ultimately privately owned and leased to provider Serco, who guarantee five years of rent paid with no voids, regular maintenance and inspection, all at no cost to landlords.

If you are a landlord or property investor, this arrangement arguably makes  a lot of sense from a financial perspective. Are you a property investor, and have you leased any accommodation to contractors for the purposes of housing asylum seekers - or would you? Or can you offer any insight into why landlords would do this rather than rent out to other tenants?

3 responses from the Newspage community

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Jonathan Moser
CEO at Mo'Living
While I haven’t leased to asylum seekers, I have leased to local authorities on behalf of my landlord clients, and it was a nightmare. Councils are desperate for housing for those on UC, housing benefit, supported living, or emergency accommodation, but my experience was poor. Rent went unpaid despite being “guaranteed,” the tenant trashed a newly renovated flat, and eviction took months. On paper, guaranteed rent sounds appealing, but the reality can be costly and stressful. Never again.
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Marcus Wright
Managing Director at Bolton Business Finance
I have arranged property finance for clients that have been leasing properties out to Serco (or local authorities) for Asylum Seekers and other vulnerable tenants since 2019. It may have hit the headlines recently but it's nothing new in property investment. There is often a clear financial incentive, with the lease agreements often paying 30-40% above market rents and ongoing maintenance covered. Although it does make it harder to get a buy to let mortgage, with only a small number of specialist lenders that charge higher rates. Ultimately, it's up to the government how they procure any housing they require and not for property investors to get into the politics of it.
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Amit Patel
Adviser at Trinity Finance
People seeking asylum in the UK have been forced to leave everything behind, its imperative that they are treated with compassion and given the support they need at the time they need it to help rebuild their lives so they can become integrated into British society at the earliest opportunity. Its a myth that refugees are prioritised for housing over British citizens.

The rental yield with these leases are far more lucrative than standard tenancy agreements.

A few niche lenders do accept Serco and Mears lease agreements and the rates are more expensive than tradional buy-to-let rates, but for landlords who wish to do the right thing morally and socially this would be a perfect strategy to pursue.