ARLA Comment on Multiple Occupation Housing Bill
Proposed housing legislation effecting the Private Rented Sector and Buy to Let investors just published (31st March) is believed by the Association of Residential Letting Agents (ARLA) to be taking broadly the right course to cover social requirements and responsibilities. The Association also believes this should be steered carefully, to achieve change without damaging the rental market or shaking buy to let investor confidence.
The Association sees this as a vindication of the position taken by ARLA for several years now. However, there are still potential areas of concern where legislative proposals remain ambiguous, particularly in the detail.
The controls proposed in the draft bill for Houses in Multiple Occupation (HMOs) should not effect the market for typical 'sharers'. The main thrust of the legislation is likely to cover larger, older properties used by five or more unrelated sharers. This will ensure that professional sharers, such as young people at the beginning of their working lives, will still be able to rent in urban centres. Damage to this traditional market had been feared when new legislation was first proposed.
The proposed legislation covering HMOs, regarded by many as hostel-style accommodation and bedsitters, is to be standardised across the country. This should remove many of the current ambiguities in the application of licensing or registration schemes by individual local authorities and, it is hoped, cap local authority license fees. These have been subject to wide variation.
Said Adrian Turner, Chief Executive of ARLA, "A combination of intensive lobbying by ARLA and the industry as a whole, and the problems demonstrated after similar ill-considered legislation in Scotland, may now result in sensible and equitable licensing for HMOs, where necessary, without damage to the Private Rented Sector overall." The draft bill also includes proposals for 'selective licensing' of landlords and their properties. Government has made it clear that this form of licensing is designed to address the issue of rogue landlords who contribute to the decline of those communities and neighbourhoods that are beset by falling prices and rents, empty properties, anti-social behaviour and crime.
ARLA has welcomed this distinction. The Association had expressed concern that proposals to license wholesale sections of the rental market would send the wrong signals to existing landlords and potential investors. These signals could have been interpreted to mean that re-regulation of the Private Rented Sector was likely.
However, the consultation documents suggest that local authorities could extend the geographical area for selective licensing away from the core problem areas. ARLA warns that this could keep new investment in the private sector well away from any such region.
Elements of the draft bill covering health and safety are aimed at bringing in new ratings systems. ARLA believes that for most of the Private Rented Sector, hazards such as fire and gas safety are already covered by existing legislation and that it is unlikely that this section of the bill will impact on the average landlord or buy to let investor.
Commented Adrian Turner, "The draft housing bill shows that ARLA has been vindicated over the broad thrust of the changes proposed. There is no need for either the proposals for HMOs or selective licensing to damage prospects for the continuing renewal and growth of the Private Rented Sector. However, together with the other professional organisations, we shall be monitoring the progress of the bill carefully to ensure that good intentions are not subverted by small print."