Communities and Local Government CommitteeWritten evidence submitted by Bristol City Council

Strategic Housing Service deals with private sector housing in Bristol including housing standards, homelessness prevention and tenancy relations. We have operated an HMO mandatory licensing scheme since 2006 and declared a discretionary licensing scheme is a part of the City in September to run for five years from April 2013. The private rented sector in Bristol is growing rapidly and according to Census 2011 figures, accounts for 22.1% of housing stock in Bristol, an increase of 10% in the last ten years.

Issue 1: The quality of private rented housing and steps that can be taken to ensure that all housing in the sector is of an acceptable standard.

The housing market across Bristol is changing and more people are now moving into the Private rented sector to make it their long term home where once owner—occupation was the tenure of choice. Bristol’s housing strategy recognises the important role that the private rented sector plays and seeks to make the best use of it. Bristol City Council holds data relating to private sector housing as a result of its day to day activities of dealing with complaints, HMO licensing and renewal activity. We have also undertaken a recent Private Sector House Condition Survey 2011 which indicated that the private rented sector accounted for 20.6% of all housing in Bristol and suggests that 29.3% of this stock is non decent . This compares to the Census 2011 figure of 22.1%—an increase from 12.2% in 2001. With this rapidly growing sector it is important that we use all the tools at our disposal to bring these properties up to standard including advice and guidance, self regulation through an accreditation scheme, enforcement and prosecution and both mandatory and discretionary licensing where appropriate. It would help Local Authorities if the tools available were simplified and for example enforcement activity on non compliant landlords made easier by introducing Penalty Charge Notices.

The Housing Health and Safety rating System is not well understood by those who do not use this assessment process and perhaps more information and advice could be provided for landlords to help explain the system.

Issue 2: Levels of rent within the private rented sector—including the possibility of rent control and the interaction between housing benefit and rents.

Rent levels have continued to increase over the last few years and we believe rent control would not work in a market where demand far outstrips supply. Changes under Welfare Reform and reduced levels of benefit available to some households is not likely to force landlords to moderate rent levels where someone else is looking for housing and willing to meet the rent demanded. Local Housing Allowance affects the most vulnerable people who are forced into the poorest quality housing and lack the ability to negotiate rents. The single room rent restriction could result in landlords converting their properties to bed sits to meet demand for housing and this in turn could result in higher likelihood of anti social behaviour as housing becomes more concentrated.

Issue 3: Regulation of landlords and steps that can be taken to deal with rogue landlords.

Our first comment is that “rogue” needs to be defined. The Rugg Review recommended that all private landlords should be registered centrally to make it easier to identify and target those responsible for properties in the private rented sector. Perhaps this report should be revisited and its recommendations considered. As a very minimum standard all landlords should pass the Fit and Proper Person Test (Housing Act 2004). A problem here is that Fit and Proper needs to be more clearly defined and guidance for Local Authorities on how to administer this would be helpful. One Local Authority may decide a landlord is not Fit and Proper where another may issue a licence as there is no common register to refer to. There should be no minimum fine levels set for poor accommodation so fines need to be a better deterrent and enforcement procedures simplified. The Housing Health and Safety Rating System is a risk based assessment rather than a set standard so it is difficult to make landlords understand what this means for them. There should be better education available to others including landlords into this assessment and its implications. Proceeds of crime and the ability to seize assets should be applied to those landlords who are successfully prosecuted. The very worst landlords who do not meet the minimum standards should be forced out of the market and their properties managed by someone else. If Local Authorities had better knowledge on where the private rented properties and who is letting them, the information would help identify rogue landlords and resources could be targeted at them. Sanctions could be applied limiting their behaviour.

Issue 4: Regulation of letting agents, including agents’ fees and charges.

At present anyone can be a Residential Letting/Management Agent as there are no qualifications or competencies required to set up as one. The worst agents would not be interested in using a voluntary scheme so it must be mandatory. Voluntary Agents Associations self regulate but they have no teeth to do anything about poorly performing agents. There should be a minimum standard or qualification needed to practice as a Letting Agency. The fees need to be controlled as agents currently charge for everything at high rates with no regular fee applied. The agents are therefore in some cases abusing their position and rarely publish a list of charges. Agents should all follow the law regarding what the landlord’s status is but this is not followed in practise.

Issue 5: The regulation of HMOs including the operation of discretionary licensing schemes imposed by a local authority for a category of HMO in its area.

Licensing of larger Houses in Multiple Occupation (HMOs) is mandatory. Under The Housing Act 2004, Parts 2 and 3, discretionary licensing can be used in an area meeting the definition and criteria to deal problems relating to wider issues with this housing sector but the legislation and guidance for introducing such a scheme needs to be simplified and the criteria easier to meet. The cost and number of public notices that must be published following designation are not sensible in the cash strapped environment being faced by Local Authorities. This process in Bristol cost £25,200 and some Local Authorities may have difficulty in meeting this legal requirement due to this high cost. The process is too dictatorial and should be balanced with the needs of meeting concerns of interested parties and the overall objectives in housing strategy. For example it is very difficult to prove anti social behaviour is being committed by private rented tenant when the Police who would provide some of this evidence do not collect evidence on tenure when an individual is arrested.

Issue 6: Tenancy agreements and length and security of tenure.

We believe a twelve month default tenancy would be preferred to help some tenants set down roots and settle into their community. Landlords report a difficulty in evicting problem tenants and perhaps are ill informed of the correct procedure to follow or evidence required to legally evict a tenant. Tenants are advised to stay put when notice is served or they will not meet qualifying criteria for homeless intervention. There appears to be an imbalance in power that a tenant has where tenancy agreements have been breached so better tenancy should be written with consequences of breaches clearly included particularly around anti social behaviour. Landlords should also be required to issue tenancy agreement as there are some who abuse their position and tenant has little understanding of their rights. Both landlords and tenants need information and support and this should be made easily available to them to help deal with and resolve issues before they escalate into eviction. Bristol is considering a Tenant Accreditation Scheme so landlords will have more confidence that the potential tenant is less likely to cause them a problem.

Issue 7: How local authorities are discharging their homelessness duty by being able to place homeless households in private sector housing.

Bristol has not used PRS to discharge its duty under the Localism Act to house homeless people. However we do use the PRS in the prevention to homelessness but the LHA is a problem where a tenant cannot afford to meet the difference in rental being charged and the allowance they are given and no alternative option is available to them. The Council has a Homeless Prevention Fund which funds deposit bonds and Rent in Advance Loans in order to ensure access to the private rented sector and to try to attract landlords to let their properties to LHA claimants and reduce the impact of low supply of low cost housing. The accommodation must also be suitable and the standards required to discharge duty are less than those of enforcement standard but these should surely be the same? There should be a minimum property standard and a minimum one year tenancy agreement. This could be a default position unless both parties opt out. Rent guarantee schemes would be a good idea but although these would attract landlords this could prove costly for the council if a tenant leaves before the end of their tenure. Direct payments to landlords would attract more landlords to participate in the scheme. Where overcrowding is a problem it would be helpful if there was more flexibility to discharge the duty by offering two properties where the households are willing and is appropriate.

January 2013

Prepared 16th July 2013