Communities and Local Government CommitteeWritten evidence submitted by the Association of Greater Manchester Authorities

Introduction

This response has been prepared by the Greater Manchester Private Sector Housing Group (PSHG) on behalf of the Association of Greater Manchester Authorities. The PSHG is a sub group for the Greater Manchester Housing Officers Group (GMHOG) and is drawn from the 10 local housing authorities in Greater Manchester, and a further three neighbouring local housing authorities. The Group’s remit includes: supporting GM HOG and the GM Planning and Housing Commission to deliver its priorities; to facilitate the exchange and introduction of best practice and to develop initiatives for local housing authorities on all private sector housing matters: to advise GM HOG on matters covered by private sector housing to assist them in their role as a lobbying group for housing issues across Greater Manchester; to develop policy approaches within the group’s area of expertise; and to encourage joint working and promote consistency through co-ordination and provision of training and sharing of knowledge.

1.0 General comments

1.1 The private rented sector is increasingly becoming a tenure of choice as emerging households struggle to secure social housing because of a lack of supply or are unable to afford the deposits to access home ownership. As a result the importance of a healthy and dynamic private rented market needs to be recognised whilst accepting the different sectors within the private rented market as a whole.

1.2 Authorities must ensure that appropriate standards of repair and management are met. However, any action taken must be proportionate and be implemented in a way that does not impose significant costs and/or alienate responsible landlords. At the same time Authorities need to identify and punish poor landlords who conduct their business without regard to the health, safety and welfare of their tenants.

1.3 AGMA recognises the benefits of working with landlords to maximise opportunities and to raise the quality of the private rented sector. The development of accreditation schemes and landlord forums are one part of this approach but any measures (such as compulsory landlord/property registration) that can be taken which make for easier access/dialogue with landlords would be welcomed.

1.4 Policy needs to be introduced/enabled to allow for a greater transparency in the sector placing more emphasis on landlords to self-regulate and more opportunities for tenants to regulate the sector through advice and information sharing.

2.0 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

2.1 It is acknowledged that the number and quality of private rented accommodation varies across the Greater Manchester area and that no single approach can be adopted to improve standards in this type of accommodation.

2.2 It is generally accepted that there are already sufficient mandatory and discretionary tools available to police this sector. The use of these different tools and approaches does, however, need to be balanced to ensure that the impact is maximised (in protecting tenants, improving property conditions and providing the appropriate incentives/deterrents for landlords) against the level of resources utilised, that is, value for money is achieved. It is vital that each Authority allocates sufficient resources and retains appropriate skills so that they can develop and implement their own private sector housing strategies to tackle poor quality housing in their respective area. This is proving particularly challenging in the current financial climate.

2.3 Improvement can be secured through a combination of informal and formal actions including the proportionate use of additional and/or selective licensing schemes to tackle local issues and prosecution of the worst offenders.

3.0 Levels of rent within the private rented sector—including the possibility of rent control and the interaction between housing benefit and rents

3.1 Rent levels are largely determined by the principle of “supply and demand” and would be difficult to restrict through the application of control measures. The reduction in housing assistance resulting from the introduction of the Local Housing Allowance (LHA) and other Welfare Reform measures is, however, increasingly forcing some tenants to move into cheaper low demand areas. This, in turn, is depressing rental levels in poorer areas further and increasing the polarisation of the private rental market.

3.2 It is widely accepted that the poorest properties in this sector tend to be those that are occupied by tenants in receipt of benefits. There is currently no link between the payment of benefits and the standards of accommodation provided by the landlord.

3.3 A number of authorities operate voluntary landlord accreditation schemes as a tool to engage with landlords and increase standards in the sector. Consequently it is recommended that suitable measures are now introduced to give Authorities the ability to link benefit payments to local or regional/national accreditation schemes so that only tenants in accredited (or licensed) properties receive benefit payments in the future.

3.4 Accreditation schemes (local and regional/national) can help local authorities and provide some confidence to tenants. They need to be monitored and, where appropriate, enforced but they do allow limited resources to be targeted at the worst properties.

3.5 This simple measure will help to:

(a)drive up standards in what are the worst sectors of the private rental market;

(b)place a minimal financial burden on landlords as such schemes are largely self-regulatory and based on landlords’ statutory responsibilities;

(c)link in with Central Government’s localism agenda;

(d)ensure that tenants are better informed so that they are more likely to report bad practice; and

(e)facilitate a more targeted approach by local authorities (if on checking, one accredited property is found to be defective, all others owned and listed as accredited by the same owner could then be checked). Whilst it is recognised that developing and operating accreditation schemes will require some additional resources, the level of these resources would be far less than those required to operate a largescale proactive enforcement approach.

3.6 It is acknowledged that the Local Housing Allowance will eventually be included in Universal Credit and that suitable measures would be required to stop the “housing” element of this payment to the tenant if the property they are living in does not meet the minimum standards.

4.0 Regulation of landlords, and steps that can be taken to deal with rogue landlords

4.1 According to the latest Census figures, there are now over 180,000 private rented properties in Greater Manchester with this expected to grow. The quality of properties and management standards varies considerably across this sector. Whilst the vast majority of landlords/properties are well maintained and managed, a lot of time and effort is spent in trying to locate landlords/properties so that issues can be tackled. This has been highlighted by work on a number of selective licensing schemes where a lot of resource was expended in trying to identify properties/landlords and not focussing on the actual problems in the areas.

4.2 Introducing a national landlord/property registration/or regulation scheme would help provide authorities a better understanding/mapping their local housing markets and neighbourhood management. It would enable a greater link up of information regarding licensing, HMOs, housing benefit etc which would speed up the contact with landlords and enable authorities to target “rogue landlords” who have not registered. The scale of registration/regulation would need careful consideration to achieve a balance between additional bureaucracy/costs and benefits to tenants and local communities.

4.3 Creating a clear and transparent register of landlords/properties would provide tenants with greater confidence that their landlord is operating legitimately and could be the start of an approach for tenants to score/rate landlords and properties independently.

4.4 Although such a scheme would be the preferred approach, and, of course, was recommended in the Rugg review, regrettably it is recognised that the Government may not wish to extend regulatory powers to facilitate these measures. If the Government are not minded to provide such a legislative framework, we would request, that as a minimum, the Government facilitates measures that enables housing assistance payments to be linked to accreditation schemes, as previously described.

5.0 Regulation of letting agents, including agents’ fees and charges

5.1 It is estimated there are over 300 letting agents operating in Manchester alone. The size, resources available and quality of these agents vary considerably.

5.2 With the private rented sector continuing to grow, it is imperative that regulation is considered for letting agents. This will help to ensure that property standards and tenants rights are properly looked after. By regulating letting agents and driving up their standards, it would give local authorities greater confidence that these properties/tenants are in good quality accommodation/tenancies enabling authorities to use scarce resources to target “rogue” landlords. It is recommended that the Government, as a minimum, considers working with local authorities and industry representatives to develop an appropriate scheme (such as the Gas Safe register), that requires agents to register and operate within agreed guidance/practice. Such an approach would provide confidence not only to tenants, but also to landlords who may wish to place the letting & management of their properties with such agents.

6.0 The regulation of houses in multiple occupation (HMOs), including the operation of discretionary licensing schemes imposed by a local authority for a category of HMO in its area

6.1 The current provision for local authorities to consider implementing additional licensing is a useful and important tool in regulating HMOs, and allows local authorities to develop local flexible approaches to address local concerns. This provision should remain.

6.2 Views on wider regulation of this sector, are mirrored in the comments provided previously.

7.0 Tenancy agreements and length and security of tenure

7.1 It is recognised that there are both good and bad landlords and tenants and that there need to be appropriate balances and checks to ensure that:

(a)landlords can evict troublesome tenants quickly and without significant cost;

(b)landlords can regain possession of properties if required, for example, if personal circumstances change and they wish to sell, and

(c)tenants have the security to establish roots as the private rented sector increasingly becomes a tenure of choice for family life and the confidence to report concerns to their landlord without the fear of eviction

7.2 Consideration should now be given to reviewing shorthold assured tenancies by the introduction of probationary tenancies similar to those already available in the social housing sector. Probationary tenancies could be granted for a six month period with an option for a further six months if the behaviour of tenant raises some concerns. Thereafter, the landlord must choose whether to renew or end the tenancy. If he chooses the former it must be for a minimum of 12 months. Similarly each further renewal should be for a minimum 12 month period.

7.3 The suggested procedures outlined in 7.2 above would achieve the necessary balance by giving tenants more security to establish and plan their futures within the local community whilst at the same time allowing the landlord to seek vacant possession should he want to either sell the property or move back in and use the dwelling as his principal home. This approach would, of course, not prevent the landlord from seeking possession for breach of the tenancy agreement by the tenant.

8.0 How local authorities are discharging their homelessness duty by being able to place homeless households in private sector housing

8.1 Authorities already have a general duty of care to ensure that any private sector housing used for referral purposes is in a safe and satisfactory condition.

8.2 This requirement can be satisfied through individual inspection before the house is used for referral purposes. Alternatively relevant links could be made with an existing landlord accreditation scheme so that individuals are only placed in accommodation provided by accredited landlords. It should be noted, that this is only likely to be viable if benefit is linked to accreditation as previously described

8.3 In practice, given that Local Authorities already work closely with private landlords through their housing options/advice services, this measure is not seen as a significant change

9.0 Summary

9.1 Introduce discretion to link the payment of LHA (or that element of Universal Credit) to Landlord Accreditation Schemes so that only tenants in accredited (or licensed) properties receive such payments in the future.

9.2 Similarly link the placement of homeless individuals in private sector accommodation to Landlord Accreditation Schemes so that referrals are only made to accredited landlords or landlords/properties where minimum standards are guaranteed.

9.3 Introduce probationary tenancies similar to those already in operation in the social housing sector. Any subsequent renewal of the tenancy must be for a minimum period of 12 months.

January 2013