Consultation on proposal to renew the existing Additional Licensing Scheme for Smaller Houses in Multiple Occupation (HMO) in Rochdale
Contents:
Background Information
What is a House in Multiple occupation?
What is HMO Licensing ?
What action has been taken already ?
How successful has HMO Licensing been so far ?
The proposed Scheme
How can I take part in the consultation ?
Rochdale Borough Council wish to renew their current HMO Additional
Licensing scheme for smaller two storey HMO's which expired on the 6th July 2016.
The existing scheme was Borough wide.
This document sets out the reasons for renewing the scheme and
seeks the view of local landlords, residents, tenants and managing agents who
maybe affected by the proposals so we would like to hear your views on renewing
the scheme for a further five years. Our intention is to retain the same area and
licensing conditions which have operated over the last ten years to maintain
continuity and avoid confusion for both landlords and tenants of HMO's.
Background Information
The Rochdale Borough is located in the Southern Pennine Moors, in the north-east region of the Greater Manchester conurbation. The Borough covers 62 square miles of which about two-thirds is rural. It is characterised by urban developments of dense housing and industrial areas located along major route ways, surrounded by hilly areas of rural land.
The Borough is divided into four Townships based around the towns of Rochdale, Heywood and Middleton, together with the eastern urban area that form the Pennines Township. Each Township has its own distinctive background and character with which residents identify.
Demand for Private Rented Accommodation
The private rented sector is growing at both national and local levels; Census figures for 2011 showed, at a national level, that there had been a significant increase in the number of households living in the private rented sector from 13.8% in 2001 to 18.1% in 2011, this represents a rise of 31.2% in the 10 year period between the two census survey’s. The sector is predicted to grow to 20-25% by 2020 (and even further thereafter). At a local level the private rented sector in Rochdale accounted for 8.8% of all tenures in 2001, this figure grew by 5.8% to 14.6% in 2011.
Increasing house prices pre 2007 and the struggling sales market when the economic down turn came are both factors that have underpinned the growth of the private rental market for both ‘active choice’ renters and ‘frustrated would be’ homeowners. Tenure reform and less accessible social and affordable rented housing is also likely to be an increasing factor to the growth in the private rented sector and the sector clearly now plays a vital role in meeting housing needs as well as providing an alternative to homeownership.
Local authorities have an important role in ensuring that the Private Rented Sector meets both the above requirements. Balancing good quality supply with demand will help to stabilise rents and encouraging good quality management will improve the reputation of the sector and encourage longer term lets and lower turnover. However, this is a challenging task where existing partners need to be encouraged to participate and new partners and investors need to be identified.
In the Rochdale borough and across the Greater Manchester sub region we expect increasing investment in the higher end of the market rental sector, which reflects the needs and aspirations of the mobile, flexible workforce GM’s future labour market and growing economy will require.
Findings of a study covering the Private Rented Market in Rochdale MBC
This study was published in April 2013 and showed an increasing demand in the borough for homes in the private rented sector. This trend has been supported by an increasing level of homes for private rent coming onto the market. Between 2009 and 2012 a total of 7,943 additional private rented came onto the market.
Need for HMO Accommodation
With around 90,000homes and a population in the region of 212,000 the demand
for affordable accommodation is high and with rising house prices across the
borough Houses in Multiple Occupation provide a valuable source of much needed
affordableaccommodation.
Although the Council values this type of accommodation, HMO's unfortunately
provide some of the poorest quality housing with issues of disrepair, overcrowding,
rubbish, untidy gardens and issues of Anti-social behaviour affecting local residents.
We are also seeing more serious cases with Rogue landlords exploiting the lowest
paid migrant workers and the use of illegal outbuildings often linked to HMO
properties.
As a council we strive to work with good landlords and encourage good practice
within our private rented sector so we have many properties which are well managed
and run in a professional manner. Unfortunately due to very high demands for
affordable housing even the poorest quality accommodation can be rented with ease
so we are keen to drive up standards within the HMO sector and take action against
those more unscrupulous landlords
What is a House in Multiple Occupation?
A House in Multiple Occupation, often referred to as an HMO, is a building, or part of
a building that is occupied by three or more people forming two or more households
and where facilities such as a bathroom, toilet or kitchen are shared. This means any property occupied by unrelated individuals such as sharers, students, single
professionals etc. is now an HMO and must therefore comply with basic Health and
Safety requirements.
What is HMO Licensing?
Under the Housing Act 2004 there are two types of HMO licensing:
. Mandatory licensing of HMOs for properties that are:
. three or more storey's high, and
. occupied by five or more persons, and
. those persons form two or more households.
This scheme operates across the country but has been of limited use in
Rochdale as most of our housing stock consists of smaller two storey houses
which fall outside the remit of a Mandatory HMO. We currently have 12
Mandatory licensed HMO's in the borough.
Additional licensing of HMOs
Rochdale Council introduced a borough wide HMO Additional Licensing Scheme in May 2006 which requires any two storey HMO occupied by three or more tenants, forming two or more households to be licensed. The scheme was extended in 2011 for a further five years. This scheme ran in conjunction with mandatory licensing but only lasts for five years so has expired this year. We currently have 12 mandatory HMO’s and 70 Additional HMO’s.
What Action has already been taken?
The private rented sector team work closely with a variety of organisations to help improve standards within HMO's across the borough and these include Greater Manchester Fire & Rescue Service, Voluntary Organisations, and local letting agents. We also operate a Private Sector Landlords Forum where we promote good practice amongst landlords and provide talks on a range of relevant and informative topics.
As well as responding to service requests and complaints from private tenants and
concerned residents, Operation Maverick is the team’s method of operation to undertake multi-agency, unannounced visits to premises where landlords, agents and property owners are likely to be operating unsuitable accommodation. This methodology has proven to be extremely successful in unearthing illegal accommodation, along with a wide range of other offences including immigration over-stayers, illegal immigrants, TradingStandards offences and welfare benefit fraud. The project has also uncovered links to serious and organised crime issues including people trafficking, sham marriages and financial irregularities.
This extra work has targeted our worst properties that are multi-occupied , often housing the most vulnerable residents within the borough, and has amassed significant intelligence about who owns and manages these properties.
How successful has HMO Licensing been so far?
Since the 2001 Census the number of private rented sector dwellings across the Borough of Rochdale has increased from 8,500 to 14,500. However, we are aware that there are many more operating under the radar e.g. not on council tax records or having, planning or building control approvals. These are often situated over commercial premises such as takeaways, garages and former offices where landlords are renting out rooms or mattresses.
There is significant potential for this sector to increase rapidly as the pressure of welfare reforms continue and increasing numbers of households look to the private rented sector for accommodation. This is likely to have a ‘knock on effect’. As demand increases and landlords begin to have more choice about whom they let their property to, the choice of properties available for lower income households that are dependent on benefits reduces and they are forced into lower quality accommodation.
It remains difficult to access data about the private rented sector generally but even more so where properties are not accredited or advertised through letting agents. Hence there is a ‘dark or hidden side’ of the rental market in Rochdale where there is a growing number of poor quality landlords offering very poor quality and often illegal properties for rent. This is a very difficult sector to monitor and manage which provides housing for very low income households with very few options.
A common theme has emerged in Rochdale of overseas students renting a property, claiming council tax exemption for the property when in fact the landlord was renting mattresses for £40.00 per week to up to 10 males in a two bed terraced. The properties are grossly overcrowded, unsafe and many of the tenants are classed as vulnerable.
We have also seen an increase of Eastern European workers in the borough on very low pay being forced into overcrowded ,unsafe HMO accommodation, sometimes tied to their employment.
Since the outset of the Additional licensing scheme five years ago there has been a
small but steady increase in larger Mandatory HMO's but we have seen a significant
increase in smaller two storey HMO's (which will be covered by Additional Licensing) but the majority of these will never meet the minimum standards and therefore Prohibition Orders are used to prevent their use as a HMO. Although we always strive to work with landlords and assist them in ensuring their HMO's provide a safe and secure place to live, we have taken a number of successful prosecutions against landlords for both failure to license their HMO.
The Proposed Scheme
Our intention is to retain the same Broughwidearea and qualifying criteria that we have operatedover the last five years of Additional HMO Licensing as we feel this will avoid
confusion, provide a familiar business as usual approach for landlords and tenants
and the growth in HMO's and associated management issues remain an issue
across the borough.
Licenses will normally last for five years although where we may have concerns over a history of poor management then a shorter two year license can be issued.
Landlords will need to supply copies of all current safety certificates such as gas, electrical, fire alarm, emergency lighting etc at the time of application. A license fee will be payable to cover the cost of administering the scheme and carrying out property inspections to ensure each HMO complies with current health and safety standards. The feefor a new license will be £839.00 with a £43.00 per habitable room inspection feefor a five year license.
Attached to each license will be a set of Mandatory conditions for each property which will cover the following areas:
- Maintenance of gas installation and appliances
- Furniture must comply with the furnishing fire safety regulations
- Electrical appliances must be maintained in a safe condition
- Smoke alarms must be maintained and kept in good working order
- All occupiers must be supplied with written tenancy agreement
- Owner must manage any issues of anti-social behaviour
- Owner must maintain the property in good condition in accordance with the HMO management regulations
- All facilities must be kept in a good state of repair
- The owner must not overcrowd the property and exceed the persons specified on the license
License holders must also be a 'fit and proper person' which means they must not have been prosecuted under the Housing Act or committed any offence involving fraud, violence etc.
The primary aim of the scheme is to keep occupants of HMO's safe, improve living
conditions, management, fire safety and to ensure that any HMO does not have an
adverse effect on the surrounding neighbourhood.
How can I take part in the consultation?
. Complete the online HMO questionnaire on the Councils Website
. Request and complete a paper questionnaire
. Attend our next Private Sector Landlords Forum on the 1 December 2016
. Email or write with your comments to:
Housing Standards Team , Strategic Housing, Number One Riverside , Smith Street, Rochdale , OL16
Emailing:
The consultation is open for ten weeks until the2 February 2017. The
results will be published in March 2017. The council’s Cabinet will take the
consultation responses into account when it decides whether to implement the
proposals.