An undercover investigation by Shelter and the National Housing Federation has found that one in 10 letting agents in England refused to let a property to someone on housing benefit, while 90% were willing to do so.

From the investigation Shelter concluded that letting agents are discriminating against tenants on housing benefit, as it discovered that a blanket ban policy was enforced by some agents even if the tenants could afford the rent.

Polly Neate, chief executive at Shelter, said: “This ugly undercurrent of discrimination is wreaking havoc on hundreds of thousands of people's lives - 'No DSS' is an outdated and outrageous example of blatant prejudice.”

The investigation into 149 regional letting agent branches found five of England's leading letting agents were discriminating against tenants on housing benefit, and that Haart was the worst offender. Mystery shoppers, deployed by the charities, had encountered a ban on housing benefit tenants in eight out of 25 Haart branches, implying that only 68% of Haart letting agents were willing to house tenants on housing benefits.

A spokesman for Haart said: “It is not our policy to refuse housing benefit tenants - anyone who passes referencing checks is able to rent properties listed with our branches. We do regularly arrange tenancies for those claiming housing benefits and currently have 112 tenancies where this is the case. This research has brought to light that some of our branches are misinformed and we are working to ensure that this policy is being followed across our network. We are sorry for any occasion where this has not been the case.”