Wednesday, 24 November 2010

Government deregulates Houses in Multiple Occupation - Real concerns for streets like Avenue Parade

Last week the Government removed legislation brought in by the last government on licensing and planning of residential properties with 4 or more occupants.

This is a backward step for Haslingden and Hyndburn in the battle to prevent private landlords purchasing family sized terraced properties and creating 4 unwanted and undesireable bedsit flats. They are unwanted and undesireable because the market tends to steer landlords towards larger houses in poorer areas.

Three years ago residents fought a conversion at the bottom of Avenue Parade and whilst car parking provides some planning protection, an explosion of unregulated and HMO's would have considerable adverse consequences.

At the moment Hyndburn has 25 HMO's in the Borough and only 2 require licensing due to being more than 3 storey's in height and over 5 occupants. There have very few complaints or problems with this sector of the housing stock and they are not considered to be an 'issue'.


Background
Several people, who do not form a single ‘household’*, and share (or lack) one or more basic amenities are HMOs. As is a large house that has been converted into self-contained flats, if it does not meet the standards of the Building Regulations Act 1991.

*Members of the same household include: husband and wife/civil partners; all close blood and half-blood relations; stepchildren.

There are 2.7 Million flat-sharers in the UK.

The Housing Act 2004 introduced the requirement of licensing of HMOs (came into force on 6 April 2006). Grant Shapps has proposed legislation to allow the creation of HMOs without the need for an application, when it is being converted from a family home. Council’s powers to restrict the proliferation of HMO’s is to be restricted to cases when it is a serious challenge to the character of the area (under article 4 of the Housing Act 2004).

- This is effectively a revocation of hard-won legislation brought under Labour.

The Chancellor has decided that housing benefit for single people under 35 should be limited to an amount which is enough to rent a room with shared facilities (HMO) rather than a small flat. This is inevitably going to lead to a greater number of people moving into HMOs.

Together, both of these changes will lead inevitably to a vast increase in HMO uptake. This increases the importance of protection from, and regulation of rogue landlords. The effects on the housing market are also important when considering protection of the most vulnerable members of society.

Housing benefit: effect on the market
The UK's flat-sharing population is around 2.7 million. If everyone eligible under the new regulation moved into HMOs, this could rise to 3.02 million (9.4% increase, or 260 330 people).

“The average UK rent for a flat-sharer stands at £348 per month. Easyroommate.co.uk calculates that a 9.4% increase in the number of flatmates competing for the same level of accommodation could push rents as high as £381 per month”

- Jonathan Moore, director of easyroommate.co.uk

If we are to value HMOs on the basis that they offer accommodation to some of the most vulnerable people in society, then this predicted increase in average rent is not to be welcomed. In conjunction with the increases in fees this could have a serious negative effect on students, and unlike loans, rent is not something which can be paid back at a later date, on low interest.

Concerns over ‘Studentification’
Within the discourse of town planning, ‘studentification’ is an overriding theme. People fear that increased, and transient student populations remove the local ‘soul’ of an area.

A concern which has been raised by several groups is that allowing the creation of HMOs without the need for licensing will proliferate, and impact negatively on the character of a suburb or city.

- HMOs can lead to an increase in social homogenization, as younger people move to an area en masse. This has lifestyle ramifications for the area.

- Containing as they do, multiple households, they are more difficult to regulate the waste and noise of. As they lack a single structure like a family home.

Chartered Institute of Environmental Health
CIEH is concerned about the adverse effects that the inappropriate proliferation of HMOs can have on the sustainability of local communities. HMOs are important to vulnerable tenants, and particularly University students. They are important, but they must not become unsustainable and harmful to local communities.

A related concern, and one taken to the courts by 3 councils (Milton Keynes Council, Oxford City Council and Newcastle City Council) is that the councils had not been adequately consulted. They wanted to strengthen their powers under Article 4 of the Housing Act 2004 – the article which allows them to challenge planning on the basis that it is a threat to the character of the area.

Standards

"One of the other things we are looking at is to make some landlords look after their properties better in return for the amount of money they make from them. This is a question of making sure the landlords do their jobs properly.”

- Colin Carmichael, (Tory) Chief Exec of Canterbury Council.

The Chartered Institute of Environmental Health is concerned that the changes may give incentives to landlords to remove amenities from properties, to bring about sharing, and thus avoid the necessity of getting planning permission.

A HMO is obviously vastly different from any other forms of accommodation. Changing a house to a hotel or residential institution requires planning permission. It seems anomalous that a HMO does not.

Quotations
"Councils understand their local area best, and they don't need burdensome rules that assume housing issues in every town, village and hamlet are exactly the same. I am also committed to safeguard the supply of rented housing - shared homes are vital for people who want to live and work in towns and cities, and are important to the economy.



"That's why I'm giving councils greater flexibility to manage shared homes in their local area. Where there are local issues with shared homes, councils will have all the tools they need to deal with the problem - but they will avoid getting bogged down in pointless applications, and landlords won't be put off renting shared homes where they are needed."



- Grant Shapps (Dept. CLG website, 7 September 2010)

“With the vast majority of England’s three million private tenants happy with the service they receive, I am satisfied that the current system strikes the right balance between the rights and responsibilities of tenants and landlords.”

“So today I make a promise to good landlords across the country: the government has no plans to create any burdensome red tape and bureaucracy, so you are able to continue providing a service to your tenants.”

- Grant Shapps (Inside Housing, 14 June 2010)

Harriet Harman has tabled an EDM calling for the reversal of new legislation relating to HMOs. (21st September 2010).

Councillor Shaun McGall (Lib Dem, Oldfield) said he was over the moon that after 10 years of campaigning on shared rented houses in the city, the Government had finally bowed to national public pressure.

"This is good for local residents - giving control over unregulated profit driven changes to the community. It's good for HMO tenants, as it will improve standards and get rid of bad landlords, by providing a mechanism for councils to set up local landlord licensing schemes.

"The changes mean that landlords will need to apply for planning permission in order to establish a new HMO with a change of use, for example when the use of a property is altered from a family home to a shared house, with three or more tenants who are not related.

"I'd like to thank residents from across the city who responded to the Government consultation last year following my campaign."

- Thisisbath.co.uk, (28 January 2010 – this is in reference to the changes made by Labour which were widely welcomed.)

Mr Healey said: "I am giving councils more local powers to crack down on the worst landlords and stop the spread of high concentrations of shared homes where it causes problems for other residents or changes the character of a neighbourhood.

"Private landlords play a big part in meeting the housing needs of millions so I want to raise the standards and stamp out the worst landlords that drag down the reputation of the rest. Councils know their communities and are best placed to help tenants facing landlords who rent unsafe or substandard accommodation and take little responsibility for the problems caused for neighbours.

"It's also right that tenants have the information they need about potential landlords, and know what to do when things go wrong. The new National Landlords Register I will set up will give them access to this important advice.

"Everyone deserves a decent and safe place to live and these measures aim to improve standards of the private rented sector at a time when more people look to rent as their first option in the housing market."

- John Healey, Thisisbath.co.uk (28 January 2010)

“I note that a number of Members on the Government Benches represent towns with higher education establishments, and that some represent constituencies with both elements. I wonder how their constituents will feel about their MP voting to strip them of the right to have a local say in this matter.”

“I turn to the health risks posed by poorly managed HMOs. The more HMOs we have, the greater the problem. I start with the fire risk. Figures from the fire service indicate that those who live in HMOs are at greater risk of injury or death from fire. Only three days ago, a bedsit was destroyed in a fire in the constituency of the hon. Member for Reading West (Alok Sharma); and last Friday a 72-year-old man died in a fire in his bedsit in the constituency of my hon. Friend the Member for Newcastle-under-Lyme (Paul Farrelly). The list goes on. The evidence strongly militates against the slackening of rules proposed by the Minister, which will open the market to additional HMOs.”

- Alison Seabeck MP (16 Nov 2010)

“More than 90% of environmental health officers have encountered landlords harassing or illegally evicting tenants, a study has found. The survey, conducted by housing charity Shelter through the Chartered Institute of Environmental Health also found that almost all officers said they had encountered landlords in the private rented sector who persistently ignore their responsibilities”

“more than 90 of officers said they had found severe damp, mould, electrical or fire safety hazards in properties they investigated in the last year. More than 60% said more than half their cases involved people from vulnerable groups.”

- Inside Housing (8 September 2010)

“It is simply not acceptable that people are handing over their hard earned cash to live in houses that are run down, squalid and in some cases even dangerous. With more and more people set to become private tenants in the future, it is absolutely vital that we expose and drive out the worst offenders in the private rented sector.”

- Campbell Robb, Chief Exec, Shelter (8 September 2010)