HMO TENANTS SET TO FACE RENT INCREASE OR EVICTION

05 October 2018

The National Landlords Association (NLA) has issued a warning, regarding tenants living in Houses in multiple occupation (HMOs) who may face an increase in rent or eviction. This is a result of the new government ruling that requires all tenants in shared houses to register with their local council.

Since Monday, there has been an increase of triple the number of houses registered with councils. This amounts to an extra 160,000 HMOs, who may face a surge in rental payments or eviction.  

The chief executive of the NLA, Richard Lambert discussed the new legislation, stating:

“When costs go up, like any other businesses, 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 so tenants will face eviction.”

HMOs are properties which house together people of no relation in separate rooms, although share bathrooms, kitchens, and other facilities. These include: student housing, shared houses, bedsits, and hostels.

The original HMO licensing scheme only required a license for properties occupied by five or more people living in three or more storeys, which could be classified as two separate households. Whereas, the new legislation has extended the licensing scheme to smaller properties, regardless of storey height, although the number of tenants still stands.

The government believes this new ruling will increase housing standards for tenant, however the Tenants Union believe a price increase would be completely unfair to tenants, who may not be able to pay, resulting in eviction.

Tenants Union representative, Ben Clay reported:

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

Currently, the median rate for HMO room rental in the UK is £385 a month, according to the Valuation Office Agency’s figures from 2017/18. This is an amount that has risen rapidly in the past three years, which has caused tenants to be concerned about further increases. 

Leeds-based HMO resident and environmental engineer, Rrouse discussed why HMOs are the only option for him, stating:

“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.”

Rrouse also discussed the implications of the new government ruling:

“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.”

The Ministry of Housing and Local Government advised that the new legislation would ensure the protection of at least 850,000 people in privately-rented properties. To further assure tenants and landlords that the new legislation is best for everyone, a spokesperson made the following statement:

“While the vast majority of landlords provide decent accommodation, these measures about raising standards in private rented home where landlords knowingly flout their responsibilities.

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