New HMO and Licencing Guidelines

On Wednesday, the Ministry of Housing, Communities and Local Government (MHCLG) published new guidelines for the upcoming legislative changes for HMOs and selective licencing announced last month.

The guidance document details the new legislations, such as introducing a minimum bedroom size to tackle overcrowding and extending mandatory licensing to smaller HMO properties to bring greater balance to the landlord and tenant relationship.

These changes are part of an ongoing effort by the Government to protect tenants' living conditions and crack down on the small minority of "rogue" landlords who abuse the system by renting out hazardous, sub-standard and poorly managed properties.

It is estimated that these changes will bring around 160,000 houses into the licencable Houses in Multiple Occupation (HMO) catchment, as the three-storey rule no longer applies, and any property, regardless of dimensions, being let to five or more people from at least two separate households will now meet the HMO criteria.

Commenting on these new changes, Housing Minister Heather Wheeler MP said:

"Everyone deserves a decent and safe place to live. Today's new guidance for landlords will further protect private renters against bad and overcrowded conditions and poor management practice."

It should be noted that the new legislation also covers refuse disposal, making landlords responsible to their local Council for managing problems with rubbish around their properties.

But how does this affect properties licenced by Croydon's Private Rented Property Licence (CPRPL)?

Wednesday's publication also announced a review to look at how selective licencing, such as the CPRPL, is used and find out how well Councils are applying the schemes. This review will see independent commissioners gather evidence from local authorities and other bodies representing landlords, tenants and housing professionals.

The National Landlords' Association (NLA) has objected to the blanket approach taken by some selective licencing schemes and has instead suggested an alternative, wherein a street by street, area by area, approach should be used to target what are statistically the worst areas for "rogue" landlords, which will also, it argues, help with proper enforcement of the licence's mandates.

The NLA also claim licence fees are a potential issue, as landlords may pass these costs on to their tenants. This will place an even greater burden on vulnerable renters, such as those on a low income or supported by their government.

NLA Local Policy Officer Gavin Dick says:

"If selective licencing schemes are used appropriately and in a targeted fashion, they can be an effective tool for councils to improve housing standards. However, they need to be implemented properly, fully resourced and enforced.

"We believe a far more effective means of improving standards in the PRS is through better co-operation between councils and landlords, which can be bolstered through accreditation."

The review findings will be reported in early 2019, with an update on progress in the Fall of this year.

The full MHCLG guidelines can be found here