Shared home tenants 'may face rent rises or eviction'

Picture of HMO properties

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There are estimated to be over 500,000 houses of multiple occupancy in England

Tenants living in shared houses in England could face eviction or increases in rent because of changes to government rules, the National Landlords Association (NLA) has warned.

From Monday an extra 160,000 houses of multiple occupancy (HMOs) have to be registered with local councils, almost triple the current figure.

The Tenants Union said any increases in rent would be unfair on tenants.

The government said the new rules would raise housing standards for tenants.

HMOs are homes where people, who are not related, sleep in separate rooms but share facilities such as kitchens or bathrooms.

Mainly students, migrants and low-paid workers live in the half a million HMO properties in England.

Currently about 64,000 of these HMOs are required to be licensed but the rule changes mean more properties will be required to be inspected and certificated by local authorities.

Previously only houses of more than three storeys and with five or more people forming at least two households had to be licensed. The new rules remove the three-storey threshold and apply to smaller homes.

The Centre for Economics and Business Research estimates the licensing process will on average cost landlords £1,200 each, and collectively, more than £95m.

Landlords say the extra licensing costs will result in rents having to be increased.

Some landlords are also expected to reduce the number of rooms they rent out, meaning existing tenants would face eviction.

‘The only way I can save money’

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Rrouse says some of the HMOs in Leeds are the worst in the country because of their poor condition

Rrouse, an environmental engineer from Leeds, has been living in HMOs for the past nine years, as he tries to save money to buy a house.

“Property prices are so high, so saving for a deposit is hard work, and rents for one bed flats are extortionate. So the only way I can afford to build a deposit is to live in a HMO,” he said.

“It’s a sociable way to rent, but the quality of the properties can vary. I’ve had HMOs where gas leaks have been common, carpets haven’t been fitted and whole kitchen units have fallen off the wall.”

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HMO tenant Rrouse said kitchen units fell off the wall in one property he lived in

Figures from the Valuation Office Agency show that the private median rent for a room in England in 2017-18 was £385 a month.

Over the past three years median room rents in England have risen twice as fast as median wages, leaving tenants like Rrouse concerned about any future increases.

“If rents do go up because of this new legislation I’ve got friends who’ll struggle to pay their rent because they just haven’t got the cash,” he said.

What is an HMO and what is changing?

  • An HMO is a property occupied by more than one household and by more than two people. For a property to be classified as an HMO, the residents must be sharing at least one basic amenity (i.e. toilet, bathroom or kitchen).
  • Examples of HMOs include bedsits, shared houses, student halls and hostels.
  • Under the old licensing scheme HMOs that were three or more storeys and occupied by five or more people forming at least two separate households were required to be licensed.
  • The new mandatory licensing of HMOs will be extended so that smaller properties (i.e. any storey height), that house five or more people in two or more separate households will also require a licence.

Source: Centre for Economics and Business Research

The new rules, which only apply to properties in England, will also require landlords to provide extra refuse bins and make sure bedrooms within HMOs are a minimum size.

The NLA said the new regulations though are the latest burden being placed on private sector landlords.

“Extra regulation will increase landlords costs,” says Richard Lambert, chief executive of the NLA.

“When costs go up, like any other business, landlords will look to pass on that additional cost in the price, meaning tenants will pay more in rent.”

“Some landlords will also reduce the number of rooms they rent out to try and comply with the legislation, meaning some tenants will face eviction,” Mr Lambert added.

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More than half of the 500,000 HMOs are now required to be licensed after the introduction of new legislation

The number of HMO licences has been increasing in recent years as more people look to rent privately.

Data from about 200 councils in England, obtained by a BBC Freedom of Information request, suggested the number of HMO licences has nearly trebled since 2013.

Ben Clay from the Tenants Union said it would be wrong for landlords to increase rents because of the introduction of new legislation.

“Renters are already facing a perfect storm of rent increases at a time when more people are having to deal with shrinking wage packets,” he said.

“We welcome this additional legislation, but we feel that there is still further to go and that all rented accommodation should be subject to regulation, to ensure standards rise”.

The Ministry of Housing and Local Government said the new rules would help protect at least 850,000 more people in privately-rented homes.

A spokesman said: “Whilst the vast majority of landlords provide decent accommodation, these measures are about raising standards in private rented homes where landlords knowingly flout their responsibilities.

“Many of the properties that will be covered by the new rules, already fall under existing licensing schemes that will be transferred into mandatory licensing free of charge, so there will be no additional costs to those landlords.”

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