Government Regulation Leads to Dramatic fall in HMO numbers

The number of HMOs in England has fallen as a result of government intervention in the housing market.

When new regulations were introduced in 2018, a House in Multiple Occupancy licence was required for properties occupied by five or more people not of one family. Prior to this, a licence was only required for properties of three storeys or more in which five or more people lived and were not members of one family.

An analysis by Octane Capital suggests that since 2018 the number of HMOs on the market has decreased. Landlords are choosing to offload their buy-to-let stock instead of negotiating yet more hurdles due to the legislative changes.

The latest data shows that, on an annual basis, the number of HMOs in England fell three per cent from 511,278 in 2019/2020 to 497,884 in 2020/21.

This overall national decline has been driven by the London market where the level of total HMOs has declined by 13 per cent - by far the biggest reduction of all regions

In Norwich, it is not easy to determine whether the number of HMOs has changed. The council website is not up to date and as an agency after submitting HMO licence applications or renewals there is a very long wait until they are issued (so long as a renewal is applied for the property is still licensed).

We firmly agree that all efforts should be made to ensure the safety and wellbeing of the nation’s tenants and that everyone is afforded the right to a basic standard of living. Young professionals often cannot afford to rent a flat or house on their own or they may turn to shared housing as an alternative following e.g. the breakdown of a relationship. Some tenants prefer the social aspect of sharing accommodation and when you move to a new city for your job sharing is a great way to make friends.

Our shared houses are fully equipped. Kitchens have everything a tenant may need to cook and dine, lounges are furnished and include a TV. Bedrooms are furnished and the whole property is made to feel as homely as possible with pictures, soft furnishings and good décor. However we also provide fire and heat detection systems, fire extinguishers and blankets, the services of a cleaning company and maintenance of gardens. We also inspect communal areas regularly to ensure there are no issues and maintenance attend more often than they might to a home rented by a family.

However the returns to HMO landlords can be significant compared to renting the same property to a family and HMOs with en-suite bathrooms are particularly sought after by tenants.

It would be appreciated if councils would work with agents and landlords who offer HMO accommodation. We provide a valuable, and actually, an essential service in the rental market that should be supported. Instead the threat of fines for infringements, the release of changes to the Amenity Standards without prior notification and the leeway for misinterpretation of these standards leads to concern by landlords. We would welcome the opportunity to have as minimum an annual meeting with the council and HMO licence holders/licence managers as well as newsletters with updates.

HMO management is a specialist field that Pearl Lettings has many years of experience in. If you have any questions about this please feel free to contact us. Call our office on 01603 980770 or email hello@pearllettings.co.uk

National data statistics provided by Letting Agent Today.