ARLA - HMO Housing Bill - Practical Difficulties
ARLA, the Association of Residential Letting Agents, has warned government of the practical difficulties, possible misunderstandings and a potential 'Empire Builder's' Charter contained in the draft Housing Bill. However, the Association endorses the intentions that lie behind many of the proposals.
ARLA's concerns were expressed at a meeting with the Minister for Housing, Lord Rooker, today (Thursday 22nd May). The meeting covered the forthcoming legislation for Houses in Multiple Occupation, Selective Licensing in areas of low housing demand and Fitness Standards.
The Minister was told that ARLA believes that only total clarity in defining HMOs and the areas of Selective Licensing, coupled to a clear direction over the scope of all regulation, will stop local authorities from going for soft targets to licence where all records and details are easily accessible. This, the Association warned, could also lead to expanding bureaucracy, an Empire Builders Charter, financed by new licence fees. It would fail to address the real problems of safety in poorly managed bedsits and hostel style accommodation and very poor quality housing in some areas.
The Association believes government should take the opportunity presented by the new Bill and positively steer local authorities away from interfering with well-regulated and market-competitive landlords, agents and properties. The Association believes that licensing must be strictly defined and only for hostel style or bedsit accommodation or where five or more unrelated sharers occupy a property. Selective licensing must be confined to those areas of low housing demand.
Unnecessary checking and licensing in the highly competitive middle and upper areas of the rental market, after repeated government assurances that the rental market will not be subject to licensing, could damage the confidence of the private landlord, the mainstay of the Private Rented Sector, the Association believes.
There are also fears that the locations chosen for the application of selective licensing could be extended to boundary areas that are not in need of this type of selective legislation. This could reduce the number of landlords where they are urgently needed.
ARLA told the Minister that already there have been comments in some local press by local authority representatives suggesting that selective licensing has the potential to provide the opportunity to extend licensing to cover the whole of their local rental markets.
Although the Association is calling for tight controls over local authorities, ARLA broadly welcomes the general thrust of proposed regulation for hostel style or bedsit style HMOs and that regulation should apply when there are five or more unrelated sharers in a property.
However, it fears that the right balance may be missing between the time and money expended on licensing and a landlord's right to receive rent or to gain possession when necessary. The Association has raised these concerns over licensing after learning that licensing in Scotland, which began by taking up to six months to process, can now take as much as a year. The draft Bill implies that if a tenant is in the property, but no licence has yet been granted, the tenant neither needs to pay rent nor to leave. This, ARLA believes, is a classic example of where clarity of definition is needed.
ARLA welcomes the proposal that Houses in Multiple Occupation are not HMOs for life but only for the term of the licence although, as a result of other parts of the draft Housing Bill, there could be a ripple of fear that licensing will be extended to other areas of the Private Rented Sector against all assurances given by government over many years.