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New crackdown approved to tackle substandard HMOs in Dudley

A new crackdown on substandard HMOs has been approved in Dudley to stop rogue landlords who cram tenants into overcrowded homes.

Councillors say they need to “make sure that new homes in Dudley Borough meet a certain standard of quality for the good of the people who live in them”.

Developers looking to turn a property into an HMO (house in multiple occupation) for up to six people will now have to apply to Dudley Council for planning permission under the new ‘Article 4 Direction’ passed this week.

While HMOs help to meet a specific housing need, especially for those on a low income, there are concerns that high concentrations in certain areas are harming their character, putting pressure on infrastructure and diminishing community relations.

It is claimed the main issues with HMOs revolve around anti-social behaviour, noise, inadequate living conditions, litter and parking issues.

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Evidence provided by West Midlands Police and the council’s anti-social behaviour team found a correlation between HMOs and increased crime and drug offence levels.

The ‘Article 4 Direction’ has now been rubber-stamped after a six-week consultation period. Councillors say the new legislation will allow the council to keep tabs on the standards of homes across the borough.

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Councillor Simon Phipps, cabinet member for regeneration and enterprise, said: “We need to make sure that new homes in Dudley Borough meet a certain standard of quality for the good of the people who live in them and other residents in the local area.

“It’s clear from the evidence gathered that the unchecked creation of small HMOs using permitted development rights undermines our ability to properly plan developments in our neighbourhoods.

“Our plan will create consistency in the planning system so all HMOs must go through the scrutiny of a planning application before they are created. But we won’t just stop at this measure, because the emerging Black Country Plan will also introduce new policies to make sure new homes are better quality and do not detract from the wider local area.”

By Josh Horritt

Source: Express & Star

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New charges for houses in multiple occupation in Coventry – what it means

Action to tackle irresponsible landlords has half-succeeded at Coventry council after one of two schemes was passed by councillors.

A city-wide ‘additional licensing’ scheme was approved at full council on Tuesday, January 14, but ward-specific ‘selective licensing’ came to a halt after it was voted down to allow for further investigations.

The new additional licensing policy will focus on houses in multiple occupation (HMO).

The scheme is likely to impact a number of student homes, which the council hopes to reduce through the introduction of more purpose-built student blocks.

Under additional licensing, a landlord who has been operating an unlicensed HMO could pay £1,250 for a one-year licence; £1,055 could be charged for a one-year licence if they are not listed as part of the council’s ‘proactive enforcement regime’; £705 for a two-year licence; £640 for a five-year licence; and £545 for a renewal.

Selective licensing would have been in certain wards, although councillors voted it down after citing an upcoming selective licensing review from the government and ‘out-of-date’ data from a 2011 census which was used to determine the areas the new scheme would fall into.

In consultation, landlords also claimed it added ‘unnecessary financial burden’ and could lead to increased costs being passed onto tenants.

Both schemes were planned to hold landlords to account and help set and maintain minimum standards across the city.

Combined the schemes would have introduced fees potentially worth thousands of pounds on landlords.

Around a dozen councillors were forced to leave the meeting and not take part in the vote as they are landlords themselves.

Cabinet member responsible Cllr Tariq Khan said the selective licensing scheme will be revisited once the government’s review has been published, while his deputy Cllr David Welsh welcomed the new additional licensing.

Cllr Welsh said: “This is probably one of the biggest steps this council has taken to improve the quality of housing in many years.

“Members will be aware what HMOs have done to the quality of housing across the city and the issues they have created.

“I look forward to working with the good landlords we have in the city and I’m very aware there’s many who do take responsibility for the properties they own and manage them well.

“But this scheme will tackle those who fail to do this, people who seek to invest in the city in terms of owning a property but don’t want to be responsible for the state of the properties and the behaviour of the tenants within.

“This scheme will give the council power to put conditions on the licence in terms of the quality of accommodation and others that we have not been able to do until now. That will make a big difference.”

Additional licensing requires all owners of HMOs that are occupied by three or four tenants and all converted self-contained flats that are wholly tenanted to apply to the council for a HMO licence.

Selective licensing would have required owners of rented properties in designated areas to apply and pay for a property licence and pass a ‘fit and proper person’ test.

Additional licensing will come into force on May 4 for a period of five years.

By Tom Davis

Source: Coventry Telegraph

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Help for landlords who struggle to keep up with pace of change

Many landlords in the UK are struggling to keep up with changes to the law that have been introduced over the past year, according to an independent survey.

Some 30 per cent do not understand the changes to House in Multiple Occupation (HMO) licensing, which came into effect in October 2018 and 28 per cent are not aware of the abolition of Section 21, which came into force at the start of June 2019 to prevent unfair tenant evictions.

The survey commissioned by bridging lender Market Financial Solutions, also found that 27 per cent are uncertain about the tenant fees ban, with a further 19 per cent saying they understand the reform but are unsure how it will affect them.

When it some to tax, there was also significant confusion, with the poll showing that 28 per cent do not understand the reforms to inheritance tax that have changed the tax free allowance on properties being passed down and 25 per cent do not know about the reforms affecting tax relief on mortgage repayments, which were implemented in April this year.

The research also found that far more landlords opposed these reforms than supported them.

Some 44 per cent are against the banning of letting fees, compared to 23 per cent in favour, 37 per cent against the abolition of Section 21 with 16 per cent in favour, while 48 per cent are against changes to buy-to-let mortgage relief and 16 per cent for.

Source: Simple Landlords Insurance

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Thousands of HMO landlords still operate without licences and provide poor living conditions

Many UK renters are living in Houses in Multiple Occupation (HMO), which, under current regulations, are properties rented out to three or more people forming at least two separate households, where tenants share basic amenities such as a kitchen or a bathroom. Any HMO that houses more than five people forming two or more separate households requires the landlord to apply for a licence to the local council, at an average cost of £600.

Students and the increasing number of people sharing flats with friends will be familiar with the common problems associated with living in an HMO. Most commonly, HMO landlords can be slow to make repairs, and the overall quality of the housing is more likely to be substandard.

Under current regulations, HMO landlords have to provide adequate fire escapes, gas and electrical safety, and minimum bedroom sizes; however, when it comes to the actual quality of the housing, there are no standards that can be enforced. In the worst cases, large-scale HMO housing has been found to contain damp and mould, kitchens in a state of disrepair, and vermin. These problems especially affect HMOs that have been converted from guest houses, as a 2015 BBC exposé demonstrated.

Moreover, thousands of landlords across the country are still avoiding licensing, putting their tenants at risk. In a landmark court case earlier this year, five Leeds flatmates took their landlord to court for failing to comply with licensing regulations, winning back all of their rent.

It may be that a more transparent and uniform landlord licensing scheme in which the money is reinvested into property maintenance could improve tenants’ living conditions – and increase landlord compliance.

‘Effective enforcement of rental sector standards is one of the biggest problems facing the lettings industry,’ says Neil Cobbold, chief operating officer of automated rental payment company PayProp.

‘Landlords might be happier to pay for these licences if they know the money is going to be used to raise PRS standards and identify rogue operators. Licensing schemes are sometimes criticised for being “revenue raisers” for local councils,’ adds Cobbold.

‘However, if authorities are more open about where the money is going and more focused on reinvesting it into housing, licensing schemes could be more effective with higher rates of compliance.’

Source: Real Homes

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Shotton landlord fined for leaving tenants without fire alarms, faulty electrics and an inadequate bathroom

A private sector landlord has been prosecuted for a number of offences under housing legislation designed to protect tenants living in shared accommodation

Flintshire Environmental Health Officers inspected a House in Multiple Occupation (HMO) at  7 Connaught Avenue in Shotton last July

They discovered the house had no working fire alarms, no fire doors, defective electrics and inadequate bathroom amenities.

The property owner Glyn Roberts had ignored requests made under HMO to produce gas and electrical testing certificates.

An Improvement Notice was served under the Housing Act 2004, a follow up inspection found that the Improvement Notice had not been complied with and that the gas boiler had been condemned for safety reasons.

Glyn Trevor Roberts pleaded guilty to all 6 offences relating to the property at Wrexham Magistrates Court.

Offences included failing to comply with an Improvement Notice, failing to register rental property, failing to obtain a licence to manage rental property and failure to supply gas and electrical test certificates.

In mitigation it was heard that Mr Roberts was in financial difficulties and was expecting to complete a sale on the property within the next six weeks and would then no longer be a landlord.

Mr Roberts was found guilty of all 6 offences and in sentencing was fined £600.

He was also ordered to pay a contribution of £200 to Flintshire County Council’s costs.

In sentencing, Mr Roberts was warned that breaches of such legislation could end in tragedy and that if it weren’t for his financial situation, the scale of the fines would have been much greater.

Flintshire County Council’s Chief Officer for Planning, Environment and Economy, Andrew Farrow, said:

“This successful prosecution sends a clear message that Flintshire County Council will not tolerate the poor management of Houses in Multiple Occupation.

This legislation is designed to protect the health, safety and wellbeing of some of our most vulnerable residents. 

It reflects Flintshire County Council’s commitment to ensuring homes in the private rented sector are in good repair, have all the necessary amenities and are properly managed.”

Source: Deeside

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Landlords face stricter rules over property cleanliness

Landlords in Glasgow are facing stricter rules on how they operate their properties.

The new regulations are aimed at curbing the impact that houses of multiple occupancy (HMO) can have on communities.

The conditions, which cover cleansing issues, repairs to common property and dealing with neighbour complaints, have come into effect following a review by Glasgow City Council’s Licensing and Regulatory Committee.

The review identified concerns linked to the presence of HMOs in neighbourhoods across the city, particularly where there are high concentrations of this type of rental property.

High levels of refuse from HMOs being left in back courts and lanes has been a common complaint to the Council, with a surge in bulk waste being dumped at the end of the academic year also being raised as a recurring problem.

William Beckett, Garnethill Neighbourhood Watch, has welcomed the changes after a landlord in area was penalised repeatedly for the rubbish left in his back court.

William Beckett, said: “I hope this is enough to stop it and I just hope that all landlords take heed of the new conditions.

“It gives them more power as well with their tenants to say look this has got to stop, these are the new rules, you’ve got to comply with these conditions, failing that then you’ll have to leave.”

Public consultation feedback also focused on difficulties with securing support from HMO landlords for repairs and maintenance to common parts of flats.

How to deal with noise and other anti-social behaviour was also flagged as a source of on-going disputes.

Councillor Alex Wilson, Chair of the Licensing and Regulatory Committee, said that striking a balance between the needs of neighbourhoods, residents, HMO tenants and landlords was essential.

He said: “I’m hoping to see a massive difference in the number of complaints that we get especially from community councils which is where the majority of complaints do come from.

“I would like to think that if there is an example to be set then hopefully the private rented sector will see the same changes, everyone will benefit.”

The new conditions for HMOs will cover:- general refuse ; maintenance, insurance and repairs of common areas; bulk refuse; neighbouring residents and statutory notices.

All of these conditions will be incorporated into a new code of conduct, which will apply to all HMO licence holders.

As part of the new conditions, a pilot project will be operated through the cleansing service provided by the council’s Neighbourhoods and Sustainability department.

The pilot will involve landlords notifying the council in advance of flats being cleared of items at the beginning or end or the academic year to ensure bulk waste is reported for collection.

By Susan Ripoll

Source: STV

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Landlords warned of £30k licensing fines

Landlords who run houses of multiple occupation without a licence could now be fined up to £30,000.

Telford & Wrekin Council has begun searching for landlords who are breaching a new law around the running and managing of HMOs.

The change came into place on October 1 last year, meaning that any rented property with five or more people living as two or more households now requires a licence.

Previously, only HMOs that had three or more storeys with five or more people required a licence, but that is no longer the case.

It means all HMOs falling under this new definition have to have a licence by law.

Other rule changes brought in by central government also mean new minimum room sizes apply to properties and a requirement to comply with the local refuse rules.

Enhanced

Landlords who renew their licenses will have to adhere to new enhanced conditions.

Last year, Telford & Wrekin Council, which is issues the licences, gave prior warning of the law change and advice on what to do.

After October 1, it granted landlords a further period of grace for applications. The council’s officers were out earlier this month and found a number of unlicensed properties. It is now warning HMO landlords who have not licensed their properties that they may face enforcement action.

Councillor Richard Overton, Telford & Wrekin Council’s cabinet member for housing and enforcement, said: “We gave landlords plenty of warning before the new law came into force last October, then we gave them extra time to help them get their heads around the new rules, complete a DBS check and submit their applications.

“Now our officers will start to investigate those who haven’t licensed and, where they find a property that should have been licensed but wasn’t, action may be taken against the landlord. Anyone found to be operating and/or managing a House in Multiple Occupation can be prosecuted or issued with a fixed penalty notice of up to £30,000.”

By Mat Growcott

Source: Shropshire Star

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New regulations for landlords in 2018: HMO licences, eviction changes, mortgage relief cuts and more

October sees the introduction of yet more new rules for landlords to keep on top of.

Recent years have seen a host of changes for landlords to deal with, a succession of policy tweaks that risk making their portfolio more complicated to administer and even less profitable.

Generally these changes are limited to the start of a new tax year, but next month will see the introduction of new rules covering houses in multiple occupation (HMO) and evictions.

Here’s what you need to know.

Licensing for HMOs

From 1st October, there will be a significant change to the licensing of houses in multiple occupation (HMOs) for landlords.

Currently, you only have to get a licence if the property has at least three storeys and is being occupied by five or more individuals, who are not all related to each other.

In addition, some local authorities can require licences for HMO properties in specific areas, even if they don’t tick either of those boxes.

Licencing is about to become far more widespread though, as the minimum property size is being removed. As a result, any HMO properties with five or more occupants will require a licence.

You’ll need to get a move on too as you need to have applied for your licence before 1st October, otherwise you’ll be classed as renting the property out illegally.

Minimum room sizes for HMOs

The changes to licences aren’t the only development for HMO landlords to be aware of. There will also be minimum room sizes for any room being used as a bedroom.

The minimum sizes are:

  • 4.64㎡ for any room in which one child under the age of 10 sleeps
  • 6.51㎡ for any room in which one person over the age of 10 sleeps
  • 10.22㎡ for any room in which two people over the age of 10 sleep

Any rooms that are smaller than 4.64㎡ cannot be used as a bedroom. In fact, if there is any room within the HMO that is smaller than that, irrespective of how it’s being used, the landlord will have to inform the local housing authority.

New eviction rules

One of the ways that a landlord can take back possession of a rental property is by issuing them with a Section 21 notice. The landlord doesn’t have to give a reason for claiming back possession but must provide the tenant with at least two months’ notice.

The Deregulation Act 2015 changed the way that a Section 21 notice can be used to bring some tenancies to an end, though this was limited to tenancies agreed on or after 1 October 2015.

However, from 1st October 2018, this is being extended to all tenancies.

So what’s changing? For starters, a Section 21 notice cannot be issued during the first four months of a tenancy (though this doesn’t apply if a tenancy has been renewed).

In addition, the notice is only valid for six months from the date on which it was issued. If you don’t follow up with possession proceedings within that six month period, you’ll have to issue another Section 21 notice.

The big change though is over ‘revenge evictions’.

Essentially, if a tenant makes a legitimate complaint about something to do with a property, such as repairs that are needed, and they aren’t dealt with then the tenant can take the issue to the local housing authority.

If the council then issues an improvement notice or emergency work notice ordering the improvements to be carried out, then you will need to act on that before issuing a Section 21 notice. Otherwise, your notice will be invalid.

So those are the key changes you need to be aware of for October. Now let’s look a little further back at the other changes that have already happened in 2018.

Ongoing changes to mortgage interest relief

Before April 2017 it was possible for landlords to deduct the interest they paid on their mortgages from their taxable income – which meant they paid tax on their profits rather than their turnover.

However, the Government decided to change the rules on that, amid concerns that buy-to-let landlords gained tax benefits that homeowners couldn’t, giving them an unfair advantage. That all began changing in the last year.

From April last year, landlords were only able to claim relief on 75% of their mortgage interest. From April this year, that fell to 50% and it’s going to keep galling until it reaches 0% in 2020.

At that point, it will be replaced by a tax credit equivalent to 20% of mortgage interest.

Changes to energy efficiency measures

New rules mean that from April this year new tenancies and renewals need to be at least rated E on their Energy Performance Certificates.

This rule will be rolled out across all tenancies over the next two years and landlords who don’t meet the requirements could face fines of up to £5,000.

Most rental homes will easily comply with this new rule as the vast majority of recently built homes will easily meet that efficiency rating.

However, an estimated 330,000 rented homes were below this standard when the rule was implemented in April, according to Which?.

While listed properties may be exempt, landlords of non-listed but older and structurally less efficient homes may need to worry.

The Rogue Landlord Database goes live

It’s finally happened; after many pledges from Government, it has finally set up a national database of ‘rogue’ landlords to share with Local Authorities.

The Ministry of Housing, Communities and Local Government has created the database, which will include landlords who have a conviction for offences such as letting overcrowded properties, unlawful eviction and gas safety offences.

Its plan is that councils will be able to share data with each other more easily so they can monitor problem landlords more closely.

However, the list will not be made public and, because of that, the scheme has received some serious criticism.

David Cox, chief executive of the Association of Residential Letting Agents (ARLA) says that it was a good idea but has been poorly executed.

“When this legislation was first announced, we were wildly supportive – anything which will help eradicate bad letting agents and landlords has our full support,” he explained.

“However, the outcome is disappointing. The database won’t be public, which means no one will be able to see it and therefore letting agents and landlords who are on the list can continue operating with impunity.

“This appears to be a pointless exercise; if the list were made public – like the equivalent for estate agents – rogue agents and landlords would leave the market for good.”

Letting fees ban

It’s not part of the 2018 tax year changes, but it’s possible it will come into force at some point in the next seven months, along with limits on deposits.

If the new legislation was put through, tenants could not be charged high fees just to apply to rent a new home. Some tenants are even charged high fees just to renew their tenancies each year.

The ban may not directly affect most landlords but many letting agents and industry commentators have suggested that it will mean a hike in prices for them as their agents recoup their lost profits.

What else could be coming?

Landlords might be getting tired of the political spotlight but with more and more people renting, especially younger people, mainstream politicians are increasingly recognising there’s a public appetite for housing reform.

So there’s likely to be more changes even before the next tax year. There has been talk of a new Ombudsman that could deliver binding resolutions to owner/tenant disputes.

There’s likely to be a new code of practice introduced to increase greater fairness for renters and the Draft Tenant Fees Bill could well mean that rental deposits are capped at six weeks’-worth of rent.

Source: Love Money

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HMO landlords: prepare for new rules

The government is cracking down on overcrowded house shares. If you’re an HMO landlord, make sure you’re up to date.

Landlords have just weeks to ensure they’re ready for new “houses in multiple occupation” (HMO) rules, which come into effect in England on 1 October.

The new regulations will bring more properties into the category of “multiple occupation housing” – this is where five or more people from two or more separate households live in one property (house shares, in other words). While at present a property is only classed as an HMO if it has three or more storeys, according to the new rules an HMO is a building or a converted flat where tenants share toilet, bathroom or kitchen facilities. This will mean roughly 160,000 additional properties will require an HMO licence, reckons the Residential Landlords Association. The new rules form part of the government’s attempt to crack down on landlords letting out overcrowded, sub-standard properties.

As well as widening the scope of what constitutes an HMO, the updated legislation adds some new conditions. The first sets out minimum space requirements. Landlords will be prohibited from letting rooms to a single adult where the usable floor space is less than 6.51 square metres (sq m). Rooms occupied by two adults will need to be at least 10.22 sq m, while rooms slept in by children aged ten and below will need to be at least 4.64 sq m. Local councils will have the discretion to require larger room sizes, but they won’t have the power to allow smaller rooms to be occupied.

Where a landlord is found to be letting a room that doesn’t meet the minimum size, local authorities will be able to grant a period of up to 18 months to rectify the situation. If no action is taken in this time, the landlord will be in breach of their licence and could either be prosecuted by the local authority or receive a financial penalty of up to £30,000. Another update is that landlords are now required to provide an “adequate” number of bins. Failure to do so is a breach of the licence and a criminal offence.

In terms of current HMO requirements, landlords must ensure that the manager of the house – either the landlord or an agent – is “fit and proper”, which means no criminal record or history of breaching landlord laws. Landlords must also send the council a copy of their gas-safety certificate each year, install and maintain smoke alarms, and provide safety certificates for all electrical appliances.

To apply for an HMO licence, contact your local council. Licences are valid for five years and you need a separate licence for each HMO you run. Landlords who already hold an HMO licence can continue to let their property until it expires; they will then have to apply for a new licence and make changes to their property so that it meets the new rules.

Licence costs vary from council to council. For example, Cambridge City Council currently charges £580 for a licence for an HMO of up to nine rooms, and £470 for renewing a licence. Croydon Council charges £250 per habitable room, so a licence for a five-bed HMO would cost £1,250.

Landlords face unlimited fines for renting out unlicensed HMOs. Even if the council takes no action, the tenants could apply for a rent-repayment order to reclaim up to 12 months’ rent, and while the property is unlicensed, the landlord cannot use a Section-21 notice to seek possession of the property. Note too that local councils can add other conditions to licences, such as improving facilities.

Source: Money Week

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What does the future look like for HMOs?

On top of the punishing stamp duty and section 24 changes of 2017, HMO landlords are now being clobbered with a national extension of HMO licensing, navigating a proposal to introduce three-year tenancy agreement. Is the future bright? Is the future still HMO?

Proposed three year tenancies

 Cities up and down the country have bid their student cohorts farewell for the summer and left (some) landlords picking up the rubbish or the one-year-only appliances slapped with the post-it note “works fine but we don’t want it!” – another toaster is added to the tip collection.

And it’s a busy time for student landlords to say the least. I recently drove down the street in Sheffield where we own several HMO’s and it looked apocalyptic! The strewn rubbish of hastily vacated digs of now ex-occupiers heading off to Ibiza, festivals and a break from university.But new government proposals aim to force landlords to offer tenants a minimum three years contract – with tenants able to leave earlier (break clause) should they wish.

The proposal comes at a time when home ownership is at its lowest in 30 years, some 14.3m households (of a total 22.8m) are owner occupied in England (62.9%), according to the English Housing Survey, produced by the Department for Communities and Local Government (DCLG). According to the same report, the private rented sector now accounts for 4.5m households, double the 2.3m in 2004, or 20% of total households as opposed to 10% of total households back in 2004.

While home ownership levels have remained relatively unchanged in the last three years, the private rented sector is a different story, particularly when paired with the latest demographics seeking entry to the current property market.

In 2005-06, 24% of 25-34 year olds were privately renting, that figure is now 46% in 2017. In the same period, 25-34 year olds buying a home with a mortgage dropped from 53% to 35%.

The proposal, which seeks to lengthen the common six-month to 1 year tenancy agreements (currently thought to be around 80% of all contract lengths), looks to give tenants more control, security and longevity in their houses.

Extensions to mandatory HMO licencing scheme – October 2018

 While the UK housing market depends on the private sector investing in houses, it is also bumping up price inflation with knock on economic effects. As a measure, the government has sought to curtail the tax relief that BTL investors have enjoyed, forcing many out of the market and reducing the sector to a sustainable size. But there’s more to come. Long in the cross-hairs of government, the HMO sector has seen particularly heavy regulation with an extension to mandatory licensing requirements, tightening up on the number of storeys loophole as well as new minimum room sizes (see below).

That could be as many as 177,000 HMOs becoming subject to mandatory licensing in England, according Residential Landlords Association research.

From October 2018, the main change to HMO legislation will be the removal of the three storey rule. In the majority of cases, a property occupied by 5 or more individuals forming two or more households will become licensable, irrespective of the number of floors in the property. Landlords will also have to adhere to a new minimum room size standard. Especially for landlords with attic rooms, it’s important to note the ‘size’ will only be considered where there is 1.5m in celling height.

  • Minimum double room size: 10.22sqm
  • Minimum single room size: 6.51sqm

There will also be a mandatory requirement for landlords to adhere to council refuse schemes to ensure that HMO properties have adequate waste management facilities.

Will the three year tenancy proposal affect HMO landlords?

There shouldn’t be a direct effect. The proposal is considering making student accommodation exempt as the sector clearly follows academic turnover and, indeed, the higher education sector relies more heavily on private accommodation than many others – this is already the case in Scotland. There is less clarity around the young professional house share market though.

Of more concern is what it does to other BTL landlords. Those who have not already sold off part of their portfolios to afford mortgage repayments following the newly introduced tax pressures, could now face even greater reluctance from lenders.

David Smith of the Residential Landlords Association responded cautiously to the new proposal: “We would warn against making it a statutory requirement to introduce three year tenancies. Many tenants simply do not want to be tied to a property long term.

“It is vital that the market is able to provide the flexibility that many need in order to swiftly access new work and educational opportunities.” says Smith.

While the proposal allows landlords to increase rent once a year to reflect interest rate changes, it does not however provide a repossession clause. This may make many lenders reluctant to shoulder the added risk (should the landlord default and the property not repossessed for three years) and may lead to even higher interest rates on Buy-To-Let mortgages.

This could mean more BTL landlords dropping out of the market altogether or, more landlords turning to the exempt sectors, such as student accommodation, actually making the HMO market more competitive.

Source: Property118