Entire streets are being "taken over to house asylum seekers", a dozen council chiefs have said.

The Home Office has earmarked half a billion pounds for a "sustainable accommodation model" designed to close the UK's 210 migrant hotels in what has been dubbed "Operation Scatter".

The department says the move will ease pressure on housing markets and has been made with the "potential impacts on local communities" in mind.

But 12 of Reform UK's council leaders have warned that "whole blocks of flats or streets of new housing are not available to local people" - creating a "them and us" mentality as a result.

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The local authority figures have pointed to a string of areas in Kent as the areas worst affected by the £500million "takeover".

Those are Thanet, Canterbury, Dover and Folkestone, the Express revealed.

In a letter to the Home Secretary, the council leaders said: "The sites that Home Office contractors identify are almost always in the midst of our most deprived communities where property is cheapest and of poor quality."

They added: "We are alarmed that landowners and landlords are going directly to the Home Office to market units exclusively for asylum use, ensuring that whole blocks of flats or streets of new housing are not available to local people.

"This is effectively creating a 'them and us' mentality.

"Given how fierce the competition for housing is with new accommodation in short supply, this becomes very divisive and puts our local communities and public services at a disadvantage, whilst pushing up demand and ultimately housing costs."

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But the department has hailed the move as a "more sustainable accommodation model" as it pointed to how the number of hotels in use now stands at "around half the peak reached under the previous Government".

At the same time, fury has erupted in Bolton over how "hundreds" of properties have been transformed into houses of multiple occupancy (HMOs).

While not every HMO will house migrants, local authority data turfed up by The Times found that the number of such residences in the Bolton area has soared from 170 to 720 in recent years.

Migration Observatory figures reveal that the number of migrants in hotels has dropped by around 8,000, from from 46,000 at the end of 2022 to 38,000 at the end of 2024.

At the same time, the number of people living in "dispersal accommodation" has surged by 10,000 from 56,000 to 66,000.

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Reform MP Sarah Pochin, whose Runcorn & Helsby seat sits just 20 miles from Bolton, said: "It is utterly disingenuous for this Government to claim credit for closing the hotels while working hand-in-glove with Serco to displace local people from much-needed housing, often targeting the most deprived communities.

"In many cases, this has reduced housing availability even further and made life unbearable for decent, law-abiding neighbours."

Shadow Home Secretary Chris Philp blasted: "Council taxes are going through the roof, private housebuilding is plummeting, and 1.3 million people are waiting on social housing lists, and yet Labour has just confessed to spending half a billion pounds of taxpayer money on accommodation for people who shouldn't even be here.

"The Labour Government is laying the foundations for a permanent parallel system that is built to reward illegal immigration funded by the hard-working taxpayer.

"All while British families wait years for a home that is becoming increasingly unaffordable due to mass immigration. Only the Conservatives will end this farce."

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A Serco spokesman said: "Serco is, in agreement with the Home Office, stopping the acquisition of more accommodation for asylum seekers in Bolton. We take all appropriate steps to confirm the suitability of addresses and work closely with the local authorities, who are directly involved in the selection of individual properties."

A Government spokesman said the new accommodation model "is designed to work more closely with councils to ensure basic, temporary accommodation is available for asylum seekers, reducing pressure on local housing markets and with full consideration of potential impacts on local communities".

They continued: "This investment is designed to leave a lasting legacy of housing for local communities and reduce pressure on local housing markets, and any other interpretation of its purpose is completely false.

"In the meantime, this programme will also help us to continue cutting costs to the taxpayer by reducing the use of asylum hotels, and ending their use entirely by the end of this Parliament."