property investors network

More government intervention in the private sector

Last week the Housing and Planning Minister John Healey announced new local powers to control the spread of high concentrations of shared rented homes and to tackle pockets of unsafe and substandard accommodation run by bad landlords.

I am all in favour of raising housing standards for tenants but here is a fundamental problem with introducing this kind of legislation. The fact is that the bad landlords take absolutely no notice of the new regulations.

I have a number of Licensed HMOs in Birmingham all of which are occupied by working young professionals. They are good properties and good tenants. I get on very well with the local enforcement offers because in their words I am seen as one of the good ones who look’s after the property and adheres to all the HMO licensing requirements. The issue is not the good landlords but the bad ones who simply do not bother to register their properties. Very often local councils are understaffed and simply do not have the resources to clamp down on the rouge landlords.

The idea of this new legislation which is coming into force in April is that you will need planning permission to turn a residential property into a multi let with 3 or more unrelated people living there. Currently an HMO only needs planning permission if it has more than six tenants. With planning departments already overstretched I anticipate this will cause a huge extra burden on the local councils and wonder how long the planning permission process will take? I am sure this will deter many investors and landlords from providing this type of accommodation. This is hardly going to help ease the increasing requirement for affordable accommodation.

My take away message from this would be if you want to get some HMOs you need to do it now before the new regulations come into force in April.

Kind Regards,

Simon Zutshi
Founder property investors network

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4 thoughts on “More government intervention in the private sector

  1. Rob Smith

    This is crazy talk by the councils. If anything this will only drive bad landlords further underground, and good landlords will not bother with hmos as they are too much work!

  2. John Wilson

    Totally agree with what you’re saying re legislation essentially penalising the good landlords and not the bad. In Scotland, we’ve had similar laws for HMO’s of 3 rooms and over for years and the high entry costs (licence and refurbs for compliance) have kept a lot of investors out of this market.

  3. Spike Reddington

    Nottingham City Council, along with many others, have applied for an Article 4 Direction. Basically, this means they will be bringing in this legislation by the back door if we don’t make our concerns noted. Get in touch with me if you’d like to know how to do so!