Tuesday, Sept 5th, PCC Cabinet approved the proposed changes to Mandatory Licence Fee Structure and Licence Conditions to be effective December 1st. We share here the perspective of an existing mandatory licence holder, large HMO landlord, Simon Fletcher who is unhappy that PCC made zero changes as a result of the consultation and, in his view, have implemented a potentially illegal solution.
Sounds like a Philip K Dick story but this was one of the big questions answered by local Chartered Surveyor and landlord, Josette Knight, at our August meeting when she passionately exposed PCC policy on communal space and lounges as unrealistic and unnecessary and pleaded for help for her 'boys' who had been homeless when PCC placed them with her, but who she now must evict because of PCC policy.
After our August meeting, many members are planning to shut down their HMOs and will need to regain possession of the property. This article outlines some of the implications and costs for all involved – imagine a blancmange hit by a cricket bat. Sadly, tenants form the blancmange... And councillors and their staff are responsible for the mess.
Landlords of 'Mandatory HMOs' in Portsmouth received a nice questionnaire asking if they thought it was a good idea that good landlords were charged less for their licence than bad landlords.
We were surprised at the number of members who complained to us about the 'loaded question'
Across the country the cost of a single room has jumped significantly – Portsmouth has seen a below average 12% increase with median rents rising to £576 per month. We predicted Additional Licensing would be the final straw after tax changes, mortgage increases and utility bills which would drive small HMOs out of the market, leaving them to be replaced by the much more expensive 'Super HMOs' and student halls. Sadly, this does appear to be the case.
The national average jumped 17% in the 2nd quarter to over £700 per month – so there is no doubt of the direction of travel locally.
If you are one of the few landlords who still has 3 or 4 bed HMOs in Portsmouth, you will need to get an Additional Licence if you wish to continue to do so. The scheme starts in September but our advice is not to apply now, but to wait until later in the year - you have until December to apply without penalty and it could save you thousands.
Our relationship with at least one of our local authorities is very poor and we do not want to make it worse, but conversely, if members are being hit with unnecessary expenses, we have a duty to help them avoid those costs. Thus, in this article several members give their views on recent examples of overly keen house inspections and, if it should happen to you, what the legal position is should you wish to challenge them.
(Note views shared here are those of individual members and form a small subset of those who responded - specifics have not been checked with qualified EHO's)
Removal of Section 21 & fixed term tenancies is widely perceived as having the most detrimental impact in the student HMO sector. Simon Fletcher shares his view on how it will impact the local marketplace.
The government has announced that foreign post-graduate students on non-research courses will no longer be able to bring family members to the UK. Regardless of your views on whether politically this is good or bad news - locally it will take a lot of pain, administrative workload and unnecessary hassle away from landlords and will reduce the pressure on local accommodation.
As an association, we are often asked to find a speaker to talk about 'Incorporation' and whether it is a good thing or not. Over the years we have had various speakers selling their specific solution but never managed to get a good discussion on the subject, until this month, when PDPLA member Richard Hemingway shared his experience of the process.
Unfortunately, we were unable to film at this meeting and several members have asked if any notes are available so, hopefully, this article will help….
Two events in April surprisingly had much in common – the St Georges Day celebration of a Roman soldier from Turkey who died in Palestine and who apparently killed a dragon and the Portsmouth Planning Committee reprimand for their behaviours toward HMOs.
It is with great sadness that we share the news of Charles passing. A stalwart of so many organisations and institutions in Portsmouth - he provided the grease that made things happen, if the city stops working as a result, it will not surprise many of us.
Charles - you will be greatly missed.
Portsmouth City Council has been ranked the eighth worst in the country for its enforcement of private sector housing, according to a recent report compiled by the National Residential Landlords Association (NRLA). They evaluated all 326 local authorities in England based on the number of hazards in private rented accommodation and the enforcement action taken by the council to address these issues.
In October we talked about 'a glint of hope' for HMO landlords who have had their properties disaggregated. The good news is that there has been significant progress over the last few weeks.
The Government have finally released the consultation which is now live and ready for us all to participate in. We have until the 31st March 2023 and it is important that you and your tenants respond to this consultation.
The Commons Levelling Up Committee has responded to the Government's White paper on the PRS, outlining a number of concerns that reflect NRLA, PDPLA and Propertymark's own response, most notably the impact on student housing and the increase in unregulated short term lets, but also in respect of a specialist housing court and improved methods of dealing with rent arrears and anti social behaviour, although they are light on detail in respect of the latter at least. There are signs they are listening to PDPLA proposals in this aspect.
There is little debate about whether local councillors like HMOs or HMO landlords, but the Portsmouth Planning Committee excelled themselves this month strongly implying one of our members, who has spent millions improving local property, was a rogue and rejecting other properties due to the lack of a downstairs toilet (nowhere does it state a property must have a downstairs toilet and in both cases, they had only been removed to meet the excessive local space requirements).
Read our complaint to the chair of the Planning Committee..
PDPLA member, Warren Somerset had an HMO with a serious bin problem and a bunch of tenants who all denied responsibility for the mess in the forecourt. After investing in CCTV and doing a bit of conscientious landlording, problem solved.
When the details of the LibDem inspired Additional HMO Licensing Scheme in Portsmouth were announced we surveyed our members. 2 out of 3 respondents plan to leave the Portsmouth HMO market this year, reducing their portfolios by 348 rooms – extrapolated to the whole Portsmouth market, that could easily see 1,000 less homes in the city by year end.
Many landlords are deciding to leave the shared housing market, but barriers to entry likely mean they can never be replaced. Once lost, rooms in shared housing are gone forever.
The private rented sector (PRS) has an important economic and social role to play across the country, according to a new report published today.
The report, commissioned by the National Residential Landlords Association, is based on a survey of 2,000 private renters in England and Wales by the polling agency Opinium. The results suggest it is wrong to conclude that private renters are trapped in the sector. It finds that fewer than one in ten (six per cent) of private renters want to switch to social rented housing. In addition, whilst three quarters (76 per cent) said they want to buy a home of their own at some point in the future, less than one in five (17 per cent) would have done so already if they could.
Contrary to popular opinion, Portsmouth is the cheapest place to live in the south – whether it be other south coast towns, or further afield in places like Bristol, Birmingham, Stratford or Nottingham – Portsmouth is cheaper. This is why so many students flock to the city (coupled with the 10-month contracts whereas other Uni's insist upon 11 or 12 month contracts). This is also why so many people who work outside the city, decide to live in the city.
Landlords in Portsmouth are experiencing high volumes of international student applications, many of whom do not understand the process for applying for private accommodation, as a result of very high numbers of international students undertaking MSc courses. As a result, Local landlords are worried there may not be enough accommodation, or that the accommodation available not being suitable, with a worrying trend for couples or even families applying to live in single rooms. This is exacerbated by the appearance of foreign 'agents' trying to source properties and what may be an organised immigration racket.
Given the two current examples in the city, both widely covered in the press, of Windsor House where owner responsibility sits with a defunct development company and the property in The Retreat plagued by squatters, rats and drug use, Alwin Oliver, Vice Chairman of PDPLA said; "Both of these cases, in which none of the parties are members of the PDPLA, illustrate that trying to recover a property on grounds of Anti-Social Behaviour (ASB) is all but hopeless, hence the need for a better procedure".
Martin Silman, chairman of PDPLA added "we have recently published detailed proposals that we would like to see courts adopt in relation to Anti-Social Behaviour cases, neighbours should not have to live with this, and landlords need better support from the authorities than they have now"
Many landlords with HMOs (C4's in planning terms) applied to Portsmouth Planning dept 10 years ago to get C3/C4 status – meaning they could freely switch between family use (C3) and HMO (C4) without needing planning permission.
At the time, they were not told that the C3/C4 flexibility only lasted 10 years and none realised the implications at the end of the period – but based on comments from Portsmouth Planning this month, many long-term HMO (C4) landlords risk losing their C4 status at the end of the period with no chance of getting it back.
Announced in 2016 for implementation in 2020, landlords have dreaded the arrival of Making Tax Digital (MTD) with the need for quarterly tax returns and automated software. The good news is that it has been delayed once more to at least 2026.
As expected, Portsmouth Councillors have voted to implement new, stricter HMO standards and enforcement policies applicable to existing licensed HMO's starting today (1st Dec 2022) and to extend this to ALL HMOs in the city by September next year (2023).
In the days after the tragic death of 2 year old, Awaab Ishak, due to extensive damp and mould in his parents rented social housing, everyone seems to be trying to deflect their own shortcomings by bad-mouthing private landlords. This triggered a whole range of responses across the various Landlord Associations we work with.
No, not a spelling mistake - a Certificate of Lawful Existing Use or Development is what you need if you want to prove that your property is legal and doesn't need Planning Permission. It is commonly asked for by solicitors as part of the conveyancing process to ensure the new owner is not caught out. Sadly, it is increasingly being asked for in relation to HMOs and could well be essential for those running 3-4 bed HMO's from before 2011 who will now need to get an HMO licence
Members who attended our September meeting will be fully aware of the level of anger and dismay among landlords as ever more HMOs are disaggregated. (See the discussion from that meeting here and the Q&A here). Two items of good news from Parliament this month, firstly Gosport MP Dame Caroline Dineage proposed an amendment to the Rental Reform Bill that would outlaw disaggregation of HMOs and then Dehenna Davison MP, Parliamentary Under-Secretary of State for Levelling Up announced a consultation on the matter.
Breaking HMOs into separate dwellings for Council Tax is illogical and hurts those least able to afford - it is a tax on the poor. Full details of what it is and why it is wrong in our earlier article here and at our September meeting (Video here). The good news is that Gosport MP, Dame Caroline Dineage has tabled an amendment to the Levelling Up Bill which will abolish Council Tax on HMO rooms.
Since the Consultation finished 2 months ago, the stony silence on the subject of Licensing smaller HMO's in Portsmouth has been almost relaxing – no worries about unachievable kitchen widths, whether the alcove by the door is counted as part of the room or not, where the washing machine is in relation to sleeping rooms – the absence of all that nonsense has been bliss.
But it will not last….
Some members may avoid our breakfast meetings, assuming we all sit around bemoaning the latest tax or regulatory changes but reality could not be further from the truth. This month we were entertained with the tale of the naked young female tenant, a policeman and as many DIY disasters as you can imagine. Read on for the full story….
I find it mildly amusing that over the past decade, as each new regulation made life harder for landlords or increased their costs, there was never any outcry from tenants on behalf of their landlords.
Yet at this months member meeting, we had 70+ attendees incensed at the impact disaggregation would have on their tenants – with calls for us to talk to MP's , start a Judicial Review, appeal and much else. Everyone agreed it is not fair, it does not make sense and it will impact those tenants least able to afford it – it is in effect a poll tax on the poorest in our society.
But when you step back, you can argue it both ways. Which side are you on?
Ever advertised a single room and had someone ask if they can have it for their family of 3? Ever let a room to one person and then found it occupied by 2 or more? What do you do? What if you have an HMO Licence which will be breached? Sadly, what was rare is no longer.
The PDPLA as members of the policy advisory board to the NRLA, have jointly signed a letter to the new Housing Secretary calling out concerns with the current proposals to reform the private rental sector. With the typical tenure for a housing minister being 10 months, it is not surprising the sector is in chaos and policies are constantly changing.
This is our attempt (one of many) to make things better for landlords in the private sector.
People tend to forget the H in HMO may stand for house but it is also a home for thousands in the city – Harry is one of those people. Approaching retirement, he had worked hard and had a good life but was watching his outgoings as you do at that age, determined to cut his cloth accordingly. He found himself in Alwin's office discussing what was available in his price range and reluctantly agreed to take a room in an HMO until something better came up.
That was over 30 years ago. Harry is still there and sadly, is dying, but with the help of his housemates – he wants to die in his HMO home.
We have long said that licensing schemes drive up rents and councillors and council staff have always refused to accept it. The challenge has been to prove a direct correlation between licensing schemes and rent levels given there are so many variables, and also, the effect of a change is not always immediate, so causality is always an issue.
Finally, we have a specific change which can be shown to have had a direct impact on rents – licensing in Portsmouth has increased rents 3x faster than elsewhere, and we can prove it! What is worse, it directly and negatively affects those most in need.
In a letter to the Portsmouth daily paper, The News, Councillor Cal Corkery argued for city-wide licensing for every property rented in the private sector.
Read on to see our response
We always said that the 'Build them and they will come' mentality of the REITs (Real Estate Investment Trusts) could not work – given the stratospheric rents these places need to charge to make money. Now it seems, the owners are looking for new ways to fill these buildings as they cannot find enough students able to afford £700 a month for a tiny room unsuited to anything else.
Well it is obvious we would not vote for it - but it is not the extra regulation, cost or bureaucracy that we are objecting to, it is the fact that the current proposals will make 1,000-1,500 people homeless and the impact on the city and across the council, in terms of rehousing the most vulnerable, the burden on Adult Social Care and many other groups, as well as the impact on local rents and house prices cannot be justified by this action.