Licensing Again

  1. Discretionary Additional Licensing in Canterbury, avoidable by model landlords.
  2. ALL 'Small' 5 & 6 bed HMOs classed 'Large' HMOs - circa April 2017 - no discretion.
  3. Minimum room size of 6.5m² for HMOs, no discretion - becoming an offense! circa April 2017

Additional Licensing is still a possibility in Canterbury, but landlords can avoid this and the cost.  However, ALL 'Small' 5 & 6 bed HMOs may soon be classed as 'Large' HMOs regardless of storey numbers... and current guidance on the minimum room size of 6.5m² could soon be mandatory for HMOs, threatening a housing crisis (many modern Canterbury houses will soon have a non compliant box-room) read on.  Presently LAs have discretion to enforce - so in future there would be no discretion - rooms under 6.5M2 will be an offense! 

Licensing is a much misunderstood topic.

Some think of a licensed property as any HMO – wrong! 

Some imagine only Licensable homes are HMOs – wrong!

Others believe that any HMO rented for the first time (since Article 4 Directions A4D were introduced in Canterbury 26 February 2016) requires a license – also wrong. Compulsory registration of new HMOs is not the same as Mandatory Licensing of Large HMOs. 

Discretionary Licensing of Small HMOs is at the discretion of the landlord – wrong!  Local authorities have discretion – not landlords. 

There are two types of Discretionary Licenses: Additional Licensing (AL) and Selective Licensing (SL).  As yet Canterbury has avoided both.  However, the local residents have long campaigned both for A4D and AL.  The former is now in place and the latter is strongly opposed by the vast majority of students and landlords alike.  However, residents argue that the problems of rubbish can only be resolved by Additional Licensing, citing Oxford and other university locations.  I.e.. landlords will only act if they are forced to by LAs.  My concern is that if we as landlords, do not proactively take responsibility for the management of rubbish at our properties, then Additional Licensing (s.54 HA) could indeed follow.  This would add significantly to Canterbury landlord’s costs - ultimately recoverable via student rents.

So how can we landlords avoid this for HMOs - with less than 5 occupants? 

Canterbury council relies heavily on landlord membership of Home Stamp as a voluntary light touch means to govern some aspects of HMO property management.  Absent an effective Home Stamp, the resident call for AL could become more compelling.  Therefore, for all its imperfections, we landlords need to not merely subscribe to Home Stamp, we must thoroughly embrace it.  This said, the current new Home Stamp management appears the most effective to date.  Inspections of HMO student properties are scheduled from November 2016.  So if you know your houses need attention, take this advanced notice to “get your houses in order”.  Such pro-action could deny evidence to justify AL.

What else can we as landlords do to avoid additional licensing and thereby avoid unnecessary additional expense? Simply put, we need to make a demonstrable difference.  Stop providing the bare legal minimum; start going above and beyond.  “What about all the other landlords who do not even comply” I hear some cry?  Excuse me, but should our benchmark be the underground basement or the open top drawer? 

Manage your rubbish better.  Remind your tenants when bin day is and the type of collections on those days.  As an incentive I am minded to offer a free a workshop, training landlords on how to create an automated system.  Once set up landlords do not need to do anything for a further year.  During this year every tenant will each week receive an automated reminder as to when and what rubbish is due.  If you are interested, let me know.  Why am I being so altruistic?  On the contrary, I simply do not want to pay circa £500 for every property I own via AL - precipitated by resident reports of poor rubbish management.  The automated system is not a cure, however, a tenant reminded is more likely to put their bin out on bin day, than a tenant who is oblivious as to whether there is even a bin.

Safety detectors.  If the local authority, ask me to put a smoke detector in the hall and landing, I will put them in every room and one in the loft for good measure.  If required to put Carbon Monoxide alarms in houses with coal and log fires, I will put them in every house with a gas boiler too.  If a fire-door is required for an inner room I will fit to every room.  Do you see where I am going?  Go large!  Pay a miserly few quid over-complying, rather than a wheely-bin load of money on AL.  Do not give the authorities any excuse to introduce AL.  And there is a bonus!  There is?  Yes, and it is paramount!  In the event that you one day find yourself in court, following an incident at your property, whether a fire, fatality or injury; you could argue against a claim of negligence by establishing you had done everything to prevent the very thing that nevertheless happened – M’lud!  Not only would you comply; you would over-comply.  This would be a compelling valid defense against an allegation of negligence to keep you out of jail!  It is a no brainer!  But the best and most noble motive is whether you could live with yourself if your tenant died, knowing you could easily and inexpensively have averted the disaster – if only you had cared enough about your tenants and demonstrated that care with action?  Finally, wouldn’t we all like to live in a cleaner safer community?   Pay a little now; or much later – your choice!

As I prepared this message, DCLG released the following:

Stop Press 18 October 2016 – see the latest on Licensing of Small HMOs

"Waste Disposal

Concern was expressed about inadequate waste disposal facilities in HMOs. This has led to problems of rubbish accumulation which blights the neighbourhood and poses a health and safety risk through pest infestation. Government wants to address this issue and will be consulting on whether it should be a mandatory condition of a licensee to provide adequate facilities for the storage and disposal of normal household waste.

Conclusions and next steps

There was strong support from all respondents to extend the mandatory licensing of HMOs. On this basis Government is proposing to take forward the following measures: • remove the reference to storeys from the prescribed description of large HMOs, so that all HMOs occupied by five or more people from more than one household, are included; • include flats above and below business premises; and • clarify that the minimum room size 6.5m² for sleeping accommodation does apply to all licensable HMOs. This will provide tenants greater certainty over the quality of the accommodation to be rented and the good character of their landlord. Local authorities will have a better understanding of the stock in their area and be better placed to tackle compliance issues and rogue landlords who have been evading detection. Finally, legitimate landlords will benefit from a level playing field, where currently their businesses are undercut by rogue landlords or agents failing to maintain their properties to the required standard. The Government is grateful for all the responses received to the technical discussion paper. Next Steps. In addition to this response document the Government has simultaneously published a further consultation on the regulations that will bring these proposals in to law, and the draft regulatory impact assessment of the proposed measures. These are available via"

To summarise: any HMO with 5 or more occupants could soon become Licensable, regardless of the number of floors, under section S.54 HA 2004 (as amended by the 18 Oct proposals) via Mandatory Licencing.  Whereas, HMOs with less than 5 occupants could become licensable under section S.55 HA 2004 via Additional Licensing if, we as landlords, do not become more proactive in managing our properties better.  In order that we might legitimately defend and thwart attempts to introduce AL, our ‘Canterbury model-landlords’ pro-action, would deny the evidence required by law, to support such Additional Licencing.