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New review to help people living in houses of multiple occupation

COMMUNITIES AND LOCAL GOVERNMENT News Release (091) issued by The Government News Network on 9 April 2008

A new review aimed at improving the management and conditions of people living in Houses in Multiple Occupation (HMOs) has been launched by Housing and Planning Minister Caroline Flint today.

Concerns have been raised about the so called 'studentification' of university towns with over concentrations of HMOs. Despite the clear economic benefits of students their dramatic growth in recent years (now almost 2.5m) has seen housing problems increase in some towns.

Towns and cities including Nottingham, Southampton, Loughborough and Bristol have reported more empty properties during the summer meaning shops, businesses and pubs simply close down creating 'ghost towns'.

An over concentration of houses of multiple occupation in one area can have a negative impact on the neighbourhood and local public services. Student turnover is typically high, 52% in Leeds for example, which can affect the sense of community as increasingly student landlords opt to concentrate properties ever closer together in university towns.

Universities are already looking at ways to improve the situation. Many have invested heavily in new student halls, created community relations officers and Loughborough University now requires their students to sign a code of conduct.

Students typically want to rent shared housing. New government rules mean they should be properly licensed to guarantee minimum living conditions and management standards.

A new survey on private landlords published today finds the licensing system is working well - over three quarters of landlords that let Houses in Multiple Occupation have now applied for licences.

The new review launched today will identify what more the planning system can do to create more effective management of HMOs for all tenants. It will feed into the Private Rented Sector review announced in January which is already looking into standards of accommodation and the rights and responsibilities of landlords and tenants.

Caroline Flint said:

"It is not acceptable that in too many areas people living in HMOs and local communities alike are having their quality of life affected. We must have balanced, sustainable communities where settled communities can live side by side with those in HMOs.

"The new HMO licensing scheme and tenancy deposit schemes are already making a difference but I want to know what more we can do to provide the right housing in the right place, guarantee proper living conditions for all, and ensure our towns are places people want to live and work in over the long term."

The new survey also found a quarter of all landlords have been letting for less than five years. A third of these are individual landlords compared to company landlords where over a third have been in business for over 40 years.

Results also showed that individual landlords tend to offer properties in a better condition than property companies. Two thirds of landlords had carried out maintenance in the last year with a quarter spending over £1000 but this has not always been on the worst properties.

In a market that requires deposits in over 75% of properties there was some reassuring news for tenants - over two thirds of the landlords surveyed returned deposits in full. Over 50% of tenancies ended because the tenant was moving and only 6% because the landlords wanted the tenant out.

There is strong evidence that the new Tenancy Deposit Protection Scheme is already helping tenants keep their deposits secure - almost a billion pounds have been effectively safeguarded in the first year. The survey showed that almost two thirds of landlords were aware of the new scheme and 50% said they planned to use it though in some cases landlords and agents were still holding the deposit.

Notes to Editors

1. The HMO review's terms of reference are available here http://www.communities.gov.uk/documents/housing/doc/termsofreference

2. The 2006 Private Landlords Survey is available here http://www.communities.gov.uk/publications/housing/privatelandlordsurvey

3. Houses in Multiple Occupation (HMOs) are a key source of housing for significant and often vulnerable groups of people in society. A wide range of residents choose to live in HMOs at some point this includes, migrant workers and young professionals. HMOs are often in poor condition and represent a much higher risk to the safety and welfare of the occupants. Poor management and the presence of unscrupulous landlords can also increase the likelihood of health and safety risks developing for tenants.

4. The government set up a national licensing system aimed at improving the controls on HMOs and ensuring adequate management standards in the properties without reducing the supply of accommodation. The Housing Act 2004 introduced licensing of HMOs. The provisions relating to the licensing of HMOs and the discretionary licensing of other private rented residential accommodation have been in force since 6 April 2006. Breach of a licence condition is an offence subject to a fine of up to £5,000. Letting or managing a property, without a licence, or permitting the property to be occupied by more persons than is specified by the licence is a criminal offence, subject to a maximum fine of £20,000.

5. All HMOs, regardless of whether they are licensable, are subject to management regulations. The regulations impose duties on the manager of the property to ensure that minimum safety requirements are met, the HMO and facilities within it are maintained and in reasonably good order and that fire precautionary equipment is properly maintained. A breach of the management regulations will result in a fine of £5,000.

6. Further information on the Tenancy Deposit Scheme can be found at: http://www.communities.gov.uk/housing/rentingandletting/privaterenting/tenancydepositprotection/overviewoftenancydeposit/

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