Portsmouth Student Halls Fail

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.  

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How Many HMOs In Portsmouth?

2,600 - of which over 1,200 are already licensed and the remainder are small ones. Not 6,000 as estimated by the council, or 4,271 as reported by the council, or 2,801 as licensed by the council last time they did Licensing. No, just 2,600 - so what is all the fuss about (that is about 1 property in every 40).

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How To Create A Portsmouth HMO

 With Portsmouth creating a self-induced homelessness crisis and threatening to remove over 1,000 HMO rooms (see our HMO Standards article) and demand for shared accommodation higher than it has ever been, we are predicting HMO median rents to rise 45%. (See our 'Economics of HMO's' paper for full explanation).

The trouble is, if you want to cash in on this you will find it hard to create an HMO which meets the city's rules – so this article explains 4 simple ways to completely legally create an HMO to ensure you can benefit from this growing market.

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The C3/C4 Planning Conundrum

 When the Article 4 Direction was introduced in Portsmouth 12 years ago, we recommended that members with smaller HMOs change the planning status of their properties to mixed use (known as C3/C4) so that they could switch between family lets and HMO letting without breaking the rules. Those C3/C4 approvals were only for 10 years (though many were not told so at the time) – but now, when owners come to renew, many are getting confused as you need to apply for planning permission to change from 'mixed use C3/C4' to 'mixed use C3/C4' which appears illogical.

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Small HMO’s: Portsmouth’s Perfect Storm

Rents for family let small houses are at record highs, demand for student accommodation is hitting a cyclical low, costs are going through the roof  and the process to introduce Additional Licensing for small HMO's has started – our recommendation is to sell up or switch to family lets.

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PCC Changes Tone

Members have long bemoaned the fact they feel like criminals when they receive a letter from the housing team at PCC and this is something we have raised on their behalf regularly since at least 2012.

Well, the new team at Private Sector Housing appear to be listening and have started a process of updating the standard communications to ensure that whilst they still convey the appropriate legal warnings, they are worded in a less threatening style. Well done PCC. 

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PCC Lose Significant Planning Appeal

Prompted by the unrepresentative  lobby group, the East St. Thomas Residents Forum, PCC took enforcement action against the institutional investment company that owned 6 HMOs occupied by 7 students. PCC argued that they were operating without planning permission.  The decision of the Appeal Judge went against PCC and could mean that many, many of their recent decisions need to be revisited.

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Fire Safety - Landlord Sentenced After Tenant Death

We have no evidence of any similar landlords locally, but recent cases nationally serve as a reminder that fire safety is not something any landlord should be casual about - it would be nice if the rules were clear and up to date but there is no excuse for ignorance or lax interpretation of those rules as one Luton landlord found after a tenant died in a fire in his HMO.

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PDPLA Newsletter - November Issue

A lot going on this month, so hopefully something of interest for everyone in this newsletter whether your interest be Airbnb, Green funding, HMO's, Student Halls, Tax, the new TradePoint discount or the University position on Covid.  Read on…

If you have not planned your transition to providing carbon neutral housing yet – now is the time to start. Firstly, if you have an EPC band E property you really need to get moving and if the tenant's income is less than £30K pa, then you can get up to £10K funding to help – see the item on LADS for detail. Have a C or D and wondering where to go next, Warren has some thoughts on that – maybe it is time to sell or better still, listen to Andrea at our next meeting.

And finally, it may be hidden away in 'Other News' but do look at the Portsmouth Transport Strategy – the success or otherwise of our city and thus our businesses is dependant upon the ability of the city to live and thrive, and it cannot do that if the streets are gridlocked and/or we are paying for multiple schemes which have little real benefit. So do have your say. And talking of grid lock, do look at the road closures in the same section. 

HMO’s – Can 139 Local Residents Be Wrong

 It was with some incredulity that we heard that there had been 139 objections to the conversion of 2 derelict shops in Stamshaw to HMO's. We consider it hypocritical that the local authorities know they need shared housing in the city, the Local Plan talks about 'mixed and balanced' communities, Housing Options place formerly homeless tenants in them yet councillors continue to encourage the demonisation of HMO's by local residents and do nothing to explain the bigger picture or allay their fears.

This against the backdrop this week of a property in Cosham, much needed to house overseas nurses drafted in to cover staff shortages due to Covid, also sitting empty due to issues with the 'change of use' required before it can be used as shared accommodation.

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Kings Estates Fined For Failing To Licence HMO

We have long argued that penalising landlords for the failings of the agents they employ in good faith is wrong, so it was pleasing to see that not only did PCC fine Kings Estates for operating an HMO without a licence, but when Kings Estates appealed the decision on the basis that they were only the agent and the owner was the licence holder, the 1st Tier Housing Tribunal not only ruled in favour of PCC but decided that PCC had been too lenient and doubled the fine to £12,000.  

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The Trouble With HMOs

Apart from the fact that they are universally despised, the trouble with HMO's is that there are all sorts of HMOs yet everyone assumes they are all the worst sort of HMO. There are a range of different overlapping definitions before you even consider the important point, which is who lives there.

As landlords, we frequently suffer as properties are lumped together under the heading and we are treated as if we are running a tenement block of slum bedsits when usually, this is far from the truth.

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Post Lockdown Property Boom

 It looks like the post lock down property surge some had hoped for arrived even before the chancellor cut stamp duty, with a buoyant Portsmouth property market seeming to have taken off last month. PCC managed to sell a whole range of properties at much higher than expected prices but on the downside, a number of landlords are struggling to prove that their HMO has been an HMO since 2011 and others are worrying that their C3/C4 status ends next year.

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What next for the homeless? Cllr Cal Corkery reflects on the Covid pandemic and looks to ideas for the future

The past few months have been an incredibly challenging time for many but one positive to have come out of the period is a commitment from government, in the short term at least, to house all homeless people. Around 15,000 rough sleepers across the country have been taken off the streets and out of crowded night shelters and instead provided with their own self-contained accommodation where they can see out lockdown safely.

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Latest University News

The University of Portsmouth have confirmed that they have pushed the start of the 2020-2021 student year back to the start of October and we have been told that the year may be compressed (shorter holidays)  in order to fit a normal year in but we don't have confirmation yet. Students are being encouraged to move to Portsmouth as usual but a lot more 'online learning' is planned for the year ahead - but we will have to wait and see what that means for us.

It could be that sharing with 3 others in a small house in Southsea is much less worrying than sharing a tower block with 800 others when it comes to social distancing....

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Student Rents - What to do in the current crisis

There has been concern among many of our members as student tenants ask for contracts to be cancelled and rent to be waived. As many members have mortgages to pay and they rely on the residual income for their pensions, any rent reduction puts them in a very difficult position financially. The good news is that none of the agencies involved support these requests – the University, the government, local MP's and others are all saying that students need to sit tight and pay their rent if at all possible. We look at who is saying what and where you can go for advice or guidance should you be affected.

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April 2020 News

April again. Last year, in the April edition, we opened with: "Normally in April we include an 'April Fool' article but we break with tradition this year and include only real news – several reasons for this: in previous years we have had members who read and believed the articles, following up some months later for updates but also, with events in the news at the moment, anything we make up is likely to be less bizarre and therefore more credible."Looking back,  it is a struggle to view last April as anything other than very normal. Hopefully, when we look back on this April it will not be so.

Much new news in this edition – hopefully enough pointers and information to help you through any Coronavirus related issues and also a couple of items specific to HMO landlords. Everyone needs to think about the impact on their tenants of the forthcoming update to electrical regulations and how they will handle it and while you are 'staying in' it is worth taking the time to review the PCC PRS strategy as it will affect us all. Also note we have updated the 'Landlords Checklist' on our website to reflect the new EPC regulations now in force.

Did you think of serviced accommodation as high workload / high return / high risk? I did until I read Charlotte's blog this month – apparently there are 3 levels of operation and in the current environment, the highest risk of the 3 is probably unsustainable. Do read it and let us know your view.

And if, instead of 'more news', you would prefer a little light hearted entertainment, here is our April fool item from 2018 (sky hooks for rubbish collection) and also, another classic (urinals in student HMO rooms) from 2015.

Communal Space in HMO’s – Have you lost a room?

We know many landlords have lost a room in Portsmouth after applying for a Mandatory HMO licence when the new rules came in last October. This is typically a 5-bed going to a 4 or similar, due to communal space not meeting PCC's very high requirement (compared to every other council in the country).

If this is you – what have you done with that room? For many, we know it is just wasted as a separate 7 or 8 square metre room in a property where the inhabitants do not live as a cohesive group has no value. The individuals often use the communal kitchen but take food to eat in their room and don't use the rest of the house except, obviously, the bath/toilet facilities as required.

One issue we are finding is that unbeknown to the landlord, one or more of the tenants decide it is a 'wasted room' and they let one of their friends live there….

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And in Other News (March)

  • Ideal Homes - The Past, Present & Future of Housing  (Eldon Building, March 6th)
  • And Homes That Are Far From Ideal (Reviewed by Bruce Lomax)
  • Housing Futures Open Competition (also at the Eldon Building, March 6th)
  • Research On Housing Development

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HMO Rules Reviewed

At this months meeting of PRED (Portsmouth City Council's committee responsible for Portsmouth's Regeneration and Economic Development) various councillors petitioned for the Article 4 Direction which limits the number of HMO's in any area to 10% to be tightened up.

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HMO's Have Permitted Development Rights!

Good news for local landlords from our friends at TP Expert today, who have just heard that one of their planning appeals has confirmed that HMO's do have permitted development rights (as many councils have sought to restrict or remove them from HMO's as part of their attempts to control and limit the spread and size of HMO's).

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Update on HMO Licensing / PCC sells landlords addresses

Last month we raised concerns about Portsmouth City Council selling addresses of landlords who own or manage HMO's in the southern half of the city.  The original article can be viewed here.

We subsequently proposed what we believed was an interpretation of the law which would meet the needs of the council and all other users of the HMO register whilst avoiding the issues raised by our members. Unfortunately, the Council have chosen not to accept this interpretation and continue to sell our addresses to anyone who wants them.

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Small Bedrooms Are OK (Sometimes)

Many landlords have struggled to explain to local councils that small bedrooms are OK and that many people in HMO's are happy to take a small room if it means they pay less in rent. There has been much debate about whether 'guidance' that rooms should be a minimum of 6.5 sq. metres (70 sq ft) should be enforced or not. In a surprising turn, central government in the form of the Department of Work and Pensions has ruled that any room big enough to contain a single bed can be used as a bedroom.

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