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Councillors aim to examine Wrexham’s licensing of houses in multiple occupation to review local standards

Calls for councillors to scrutinise the licensing of houses in multiple occupation (HMOs) across Wrexham have been made.

A topic request form signed by Holt councillor Michael Morris and Smithfield councillor Adrienne Jeorrett has been submitted for consideration by members of the homes and environment scrutiny committee.

It states that: “For some time members have expressed concern over the quality, appropriateness and size of accommodation which is offered to individuals residing in houses in multiple occupation (HMOs) and which is controlled by the licensing regime rather than through the planning process.”

Such concerns over the size of accommodation and amenity space provided in some HMO proposals have been raised numerous times over the years by councillors and planning committee members.

Speaking about plans to convert a property on the outskirts of the town into a HMO last December, Cllr Jeorrett said it was a “great disappointment that adults are having to live in one room with a long term impact on health and wellbeing.”

As part of the work looking into the licensing of HMOs, it is suggested that scrutiny “undertake a review of how the current standards were arrived at” and if they are nationally prescribed or determined locally.

It also proposes that the committee:

– Compare with other Local Authorities to establish if our standards are more or less generous than others and if they need reviewing.
– Consider the issue of bed spaces versus bedrooms and occupancy numbers.
– Consider how to ensure that HMOs offer a reasonable standard of accommodation by providing rooms of an adequate size for the number of occupants and reasonable communal living areas/ circulation space.
– Establish if there need to have differing standards for the various types of HMO eg. those that primarily house contractors who are working in the area and those that are conventionally let to tenants – (the former having a much greater parking need)
– Possibly look at a “Landlords Charter” on how they will deal with complaints

It is hoped that the scrutiny committee will help “remove the tensions between determining planning applications and and the licensing regime for HMOs” – along with “ensuring a better quality of accommodation for the tenants” and “reducing the tensions with the adjoining community neighbours”.

It is estimated that the topic will take four months to be examined by scrutiny members.

Previously in 2017 we have reported how there has been concerns that there is a lack of staff due to council cuts for inspections, as well as the implication there could well be a large number of unregistered HMO’s out there.

At the time we reported, “Detail was given to the meeting over the five year inspection periods, with an officer explaining that although the five years is the maximum mandatory inspection period, HMOs that are of concern could be inspected much more regularly such as six monthly. Lead Member for Housing, Cllr D J Griffiths, did point out that it was a chicken and egg situation at times as without investigating properties the council would not know of any issues to deal with, but without the staff to do so then investigations may not be as frequent” and “More detail was given on work done to locate unregistered HMOs, including: “There are probably more HMOs than are legally registered, but it is finding them is the challenge. We look at various sources, council tax bills, housing benefit information, or even looking on the internet to see what is to let locally.”

Source: Wrexham

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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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HMO conversions for 3 to 6 people will require planning approval from June 2020

A citywide direction on houses in multiple occupation (HMO) will be introduced by Birmingham City Council from 8 June 2020.

The Article 4 direction will mean that planning approval is required for the conversion of a family house to an HMO accommodating between three and six people. Current planning rules only require planning approval for properties larger than this.

The direction will be supported by a proposed new planning policy set out within the Development Management in Birmingham document, which is subject to a six-week public consultation period from 9 January 2020. The consultation will close at 5pm on Friday 21st February 2020.

An existing direction for this purpose is already in force in Selly Oak, Harborne and Edgbaston and has been successful in limiting the growth of HMOs in those areas.

Ahead of the direction coming into force, landlords are being advised to declare existing HMOs to the council. Any existing HMOs declared after that date are likely to require a retrospective planning application or a certificate of lawful use, both of which will incur a charge. New HMOs created after 8 June 2020 will require a planning application.

Councillor Sharon Thompson, Cabinet Member for Homes and Neighbourhoods, said: “Shared accommodation or houses in multiple occupation provide an important way of meeting the city’s housing needs. However, high concentrations of HMOs can have a negative impact on the character of neighbourhoods and create unbalanced communities.

“This direction will enable the council to manage the growth of HMOs across the city more effectively as any new proposals will be assessed in line with planning policies.”

Further information about the city-wide direction and the process for declaring existing HMOs can be found at www.birmingham.gov.uk/hmoarticle4

By Kyle Moore

Source: Birmingham Updates

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HMO Sector To Grow As Investors Expand Property Portfolios

New data released has shown that the HMO sector is likely to grow with over a fifth of landlords planning to expand their portfolio with the addition of an HMO (House in Multiple Occupation).

The HMO sector is proving to be attractive to professional landlords in a time of market uncertainty, with HMO landlords achieving the highest average rental yields at 6.3 per cent compared with the market average of 5.5 per cent.

The research from specialist lender Precise Mortgages shows average rental yields across the market as a whole are at their lowest for nine years, highlighting the attraction of the HMO sector. Average yields for all property types dropped 0.3 per cent in the second quarter from 5.8 per cent in the first quarter of this year and are now at their lowest level since 2010.

Terraced houses are proving to be the most popular choice for buy to let property investors, with 50 per cent of landlords planning to buy a terraced property. However, the research also shows 40 per cent of landlords also plan to sell terraced houses in the year ahead. By contrast, just 8 per cent of landlords holding properties in the HMO sector plan to sell them.

Blocks of flats are also set for growth, with 8 per cent of landlords planning to buy compared with just 5 per cent planning to sell.

Landlords with between 11 and 19 properties are earning the highest average yields at 5.9 per cent with the North West the best area of the UK for yields, earning an average 5.9 per cent. Landlords with 11 or more properties have an average of three different property types in their portfolio.

Managing Director of Precise Mortgages, Alan Cleary, said: ‘In a time of market uncertainty, HMOs are an attractive option for professional landlords looking to maximise yields. As HMOs attract multiple tenancies, gross rental income tends to outstrip single lets meaning the rental income is more secure if one tenant leaves a void.’

He continued: ‘The expansion of the HMO sector underlines how experienced landlords are re-balancing their portfolios. It also demonstrates the opportunity for brokers to work with specialist lenders who have expertise across the widest product set to support clients who are reassessing their portfolios.’

Source: Residential Landlord

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HMO Property Investments Popular As House Sharers Get Older

Buy to let property investors are increasingly looking to HMO property investments as house sharers get older.

The latest data from property sharing platform, ideal flatmate, has looked at the changing face of the house share landscape and how more and more people above the age of 50 are prepared to be house sharers as a viable way of living.

Sharing houses has become a popular choice for many, particularly in major UK cities, where the cost of renting is too high to tackle alone.

House sharers are traditionally young people, with the 18-25 age group accounting for 43 per cent, while another 36 per cent are in the 25-35 age group.

As people become older, they are normally less likely to be house sharers, with 35-45 year-olds making up 13 per cent, 45-55 year-olds 6 per cent, and just 2 per cent of house sharers aged over 55.

However, this trend is starting to change.

just in this year so far Ideal Flatmate has seen an increase of 74 per cent in the number of over 50s using the platform compared to 2018, indicating that the older generation is coming around to the idea of being house sharers.

Co-founder of ideal flatmate, Tom Gatzen, thinks perceptions are starting to change and being house sharers has lost the ‘stigma’ it used to have, as rents continue to climb, and the issue of affordability grows ever larger. He thinks that ‘people of all ages are starting to band together and tackle the rental market in whatever way they can’.

He said: ‘Age is just a number and it’s one that doesn’t seem to hold any bearing what so ever when looking for that ideal flatmate and we expect that the fabric of the UK rental sector will continue to evolve as a result of this diversity and acceptance.’

Buy to let property investors can benefit from this new-found enthusiasm for house sharers with HMO investments that tend to bring higher rental yields.

Source: Residential Landlord

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Landlords warned to prepare for new HMO rules

FROM April 1, the licensing laws for Houses in Multiple Occupation (HMO) in Northern Ireland have changed.

Mandatory HMO licensing is being extended because of concerns about the number of HMOs operated by landlords who rent out sub-standard, overcrowded and dangerous accommodation, exploit vulnerable tenants and in some cases defraud the public purse.

A house in multiple occupation is a single property in which multiple households live and share basic amenities. A typical HMO may have a kitchen and/or bathroom shared between two or more rented households. These laws do not apply to rented flats or apartments with separate facilities.

According to figures obtained by the BBC, there are over 6,000 HMOs in Northern Ireland, with more than 4,000 based in Belfast.

Under the new scheme, all HMOs in Northern Ireland must hold a valid licence and landlords without licences or found to be in breach of the conditions of their licence, risk significant fines of up to £20,000 and/or prosecution.

HMOs previously been registered with the NI Housing Executive, which still benefit from valid unexpired licences, will automatically transfer to the new local council scheme. HMO licenses are valid for a period of five years and must be renewed periodically.

The licensing of all HMOs in Northern Ireland is now managed by the relevant local council. The ultimate purpose of the new legislation is to ensure that the accommodation is safe for the tenants and surrounding neighbours.

Under the legislation, landlords must have an anti-social behaviour plan in place and keep a record of instances of anti-social behaviour and what actions have been taken by the landlord to deal with the situation. Landlords will be provided with a guide from the Council, advising them on how to tackle these issues.

The legislation also requires HMOs to adhere to certain health and safety standards. The property must benefit from valid up to date safety and maintenance certificates for all relevant appliances.

From April 15, tenants of HMOs will be able to contact their local council to check if the property they reside in is registered as a HMO. Under the legislation, the tenant can report their landlord to their local council if the tenant suspects that there is not a valid licence in place or if the conditions of the licence are being breached.

The local council has the power to impose certain conditions on licenses and revoke HMO licenses if conditions are not being met.

The rules could have a major impact on city landlords who rent out premises to students and the growing number of professionals who share houses and flats.

By Oonagh Murdock

Source: Irish News

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Residents voice their frustration as plans for HMO are granted on appeal

Frustration has been voiced after plans to create a six-bedroom house in multiple occupation (HMO) in Wrexham were granted on appeal.

During November, members of the local authority’s planning committee rejected proposals to convert an existing house on Beechley Road in Hightown to accommodate a total of seven people.

It came after they carried out a site visit where concerned residents carrying placards raised issues over parking and fly tipping as a result of the six existing HMOs on the street.

The Beechley Road Residents’ Association also presented a petition with 90 signatures against the development.

However, the decision to refuse the scheme has now been overturned by a planning inspector appointed by the Welsh Government.

Cllr Graham Rogers (Lab), who represents the area, said the news had left him angered.

He said: “It’s very frustrating and disappointing. There’s already a number of HMOs along Beechley Road and now we’ve got another one.

“There’s going to be traffic issues because of where it is at the end of the road.

“What’s the point in having a planning committee when someone who sits in an office about 150 miles away can change the decision?

“I’d like to thank the residents who helped to fight against it. It’s so frustrating, but what more can you do?”

Council officers had originally backed the plans for approval as they said they complied with all the authority’s policies.

But an alternative recommendation for refusal was put forward by councillors on the grounds of parking and access issues, which was approved by eight votes to four.

In his decision notice, planning inspector Iwan Lloyd concluded that the proposal would not harm road safety.

He said: “In my view the proposed access would be satisfactory in relation to visibility and sight stopping distances.

“On-street parking may impede visibility but there are numerous vehicle entrances serving properties in the vicinity of the site and there is no evidence to indicate that these are not operating safely.

“Turning to the second reason for refusal, the council’s highway engineer confirms that the proposal complies with planning guidance which seeks a maximum of four car spaces.

“This is exceeded in this case and the proposal would provide for secure cycle storage.

“The site is situated in a sustainable location and on-site car parking provision could accommodate visitor parking in this instance which should overcome the council’s and residents’ concerns.”

Mr Lloyd said he had also considered representations regarding the over-concentration of HMOs on the street, issues with the potential behaviour of future tenants and problems with bin storage.

However, he said such matters did not form part of the council’s reasons for refusing the application and did not outweigh his decision.

By Liam Randall – BBC Local Democracy Reporter 

Source: Wrexham

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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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Glasgow to introduce stricter licensing conditions to curb impact of HMOs

Landlords in Glasgow are facing stricter new conditions on how they operate their property as part of an effort to curb 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, will come into effect following a review of HMO licensing by Glasgow City Council’s licensing and regulatory committee.

The review identified many 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 is a common complaint with a surge in bulk waste being dumped at the end of the academic year also being raised as a recurring problem. Public consultation feedback also focused on difficulties with securing support from HMO landlords for repairs and maintenance to common parts of flatted property. How to deal with noise and other anti-social behaviour was also flagged as a source of on-going disputes.

While it was found there is no legal basis for a cap on the number of HMO licences issued within Glasgow, the review reiterated that the purpose of HMO licensing is to protect public safety. The review conclude that better management of HMOs was a practical way forward.

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.

Councillor Wilson said: “It is clear there is a strong depth of feeling about how HMOs operate in the city. There is a range of issues that are regularly brought before members of the committee and we know that the way HMOs are sometimes managed cause real problems to other residents.

“But the public safety purpose of the HMO system should not be put to one side. HMOs provide homes of a reliable standard for people who cannot otherwise afford to live independently and that’s a system we support.

“The advice we have received means there is not a legally defensible way to limit how many HMOs there in Glasgow as there is a continuing need for kind of accommodation. So focusing on what really bothers people about the way property is managed is the way to deal with this.

“Indiscriminate dumping of rubbish, refusing to pull your weight with the cost of repairs, failing to get a grip with noisy or anti-social tenants – these are the issues that upset other residents. By creating conditions of licence that focus on the issues of concern we are setting out very clearly the standards we expect of our HMO landlords. The conditions will help to ensure we can take a more robust approach with licence holders who do not meet expected standards.”

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.

The review also found that it would not be appropriate to use planning policy objectives to limit HMO residences to over-ride a licensing system intended to protect public safety.

Source: Scottish Housing News

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Shawbrook helps investor with £3.35m refinance on nine HMOs

Shawbrook partnered with Sirius Property Finance to help an experienced investor remortgage nine HMO properties worth £3.35m.

The properties were purchased using bridging finance in June 2018, however as the term was coming to an end the client wished to remortgage quickly to avoid any fees.

Robert Collins, co-founder of Sirius Property Finance, said: “Along the way we had to liaise with the valuer to have the original reports readdressed and to clarify the net rental position as they had originally used a 20% discount that affected affordability.

“However, due to the partnership between me, the client and the team at Shawbrook we were able to provide a solution within the short time frame. It was a fantastic team effort and I’m delighted that our partnership with Shawbrook had a positive outcome for the client.”

Peter Turner, senior development manager for Shawbrook Commercial Mortgages, added: “The turnaround on this case was tight but the teams from both Sirius and Shawbrook worked together to re-mortgage the nine HMOs of the customer, avoiding the bridging finance penalties.

“I’m delighted we were able to help with this case and look forward to continue working with our newest strategic partner.”

Using Shawbrook’s LRI2 product on a 10-year, interest-only term, the team worked with Sirius to ensure the deal was completed in time.

The AIP was submitted on 6 November and the case was completed before Christmas ensuring that the bridging finance was repaid within the term and allowing the client to avoid over-run penalties.

Source: Mortgage Introducer