Communities Secretary Greg Clark said the plans, which will be included in the upcoming immigration bill, would crack down on "rogue landlords who make money out of illegal immigration".
It follows a pilot of the scheme since August 2014 where private landlords in the west Midlands have been required to establish that new tenants have the right to rent in the UK. Those failing to do so face a penalty of up to £3,000.
The new proposals would see the Home Office issue landlords housing asylum seekers with a notice when their application fails, confirming that tenant no longer has the right to rent in the UK.
Under this regime landlords will be given the power to end tenancy agreements without a court order if tenants’ asylum requests are rejected while the government will also put a stop of financial aid for failed asylum seekers.
Currently illegal migrants residing with family in the UK can claim £36 a week from the government with 10,000 people benefitting from the payouts at last count.
But the greater powers to evict come with harsher punishments for landlords who fail to comply.
The government said it would begin compiling a black list of landlords who fail to check tenants’ rights to rent or to evict them when asylum applications fail. If landlords repeat offend they will face five years in prison.
Speaking on the BBC’s Radio 4 Today Programme, Clark said the plans formed part of a "joined-up system to send people home".
He added: "That is exactly what the Home Office have the power to do in serving the notice confirming there is no longer the right to rent."
Also speaking on the Today Programme Richard Lambert, chief executive of the National Landlords Association, said the proposals were a "welcome step forward".
He said: "I am slightly concerned that we are breaking the 40-year-old principle that it has to be a court that ends a tenancy... but we do need something that will work in practice."
The announcement comes after nightly reports showing migrants breaking through security at Calais in France in a bid to gain access to the UK through the Euro tunnel. Negotiations between France and the UK are ongoing.
David Cox, managing director, Association of Residential Letting Agents, said in a statement: “ARLA believes that the measures announced by the Government today are a good first step and we welcome the proposals in principle. The plans will help to weed out the minority of rogue landlords who exploit vulnerable immigrants for their own financial gain and, with the introduction of a new five year imprisonment penalty, will help to deter other such unscrupulous individuals from entering the private rented sector.
“The proposals also build upon the Right to Rent checks as imposed by the Immigration Act 2014, which we expect to be rolled out nationally following a pilot scheme in the West Midlands. We will be organising training sessions for our members to ensure they are fully prepared and understand the new rules and we urge all letting agents to ensure they are ready for the impending roll out.”
