Communities and Local Government CommitteeWritten evidence submitted by Norwich City Council

Summary

1. The private rented sector plays a key role in meeting housing needs in Norwich, and the council has built partnerships with its reputable landlords and letting agents in order to improve the sector. However, it is one with a high proportion of privately rented properties containing significant hazards to health (category 1 hazards) and we do not know where the majority of these sub-standard properties are located.

2. It is vital that we know where private rented accommodation is in order for us to effectively use our resources and powers to ensure the quality and standards of properties being let.

3. The council believes that there are a number of measures that can be taken which would significantly help to address overcrowding and poor conditions by enabling inspections to be targeted and providing meaningful sanctions for landlords who let sub-standard properties. These measures include the introduction of a mandatory landlord register, regulation with regards to the letting properties free of category 1 hazards and flexible local schemes for all properties in the private rented sector, not just houses in multiple occupation (HMOs),

Introduction

4. Norwich City Council provides services to the city of Norwich, covering a population of approximately 132,500 people. We want our residents to have the choice of good quality, well-managed, affordable accommodation of different types and sizes across the city. We are also committed to tackling poor housing conditions and reducing health inequalities. Our forthcoming housing strategy, in part, concentrates on these priorities and seeks to:

(a)identify and remove barriers to residents who want to rent privately;

(b)prevent and remedy harassment and illegal eviction of private-sector tenants;

(c)substantially reduce the number of hazardous, poorly managed and sub-standard privately rented homes through enforcement;

(d)improve the energy efficiency of all homes in Norwich; and

(e)carry out research to improve our understanding of the condition of the private sector stock.

5. The population of Norwich is the fastest-growing in the east of England. The biggest increases in numbers of people are for young people aged 20–29 (21.2%) compared with 13.6% in England.1 These young people are more likely to rent privately because they are unable to access mortgage finance to purchase on the open market.2 However, if on a low income, people in this age group are also affected by the reduction in housing benefit for single people under 35.3 This means there is an increased likelihood they will seek social housing or live in shared accommodation in the private rented sector.

6. In light of the current economic climate combined with local population changes and welfare reform, there is and will continue to be an increase in the number of people in need of HMO accommodation in the private rented sector, many of whom are likely to be vulnerable.

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

7. In 2011 privately rented accommodation from private landlords and letting agencies accounted for 20.1% of housing in Norwich,4 an increase of 8.3% since 2001, compared with a growth of 6.6% across England and Wales to15.3%.

8. According to our last stock condition survey in 2006,5 there was an estimated total of 2,000 houses in multiple occupation (HMOs) in Norwich, of which approximately 160 are licensed under the mandatory scheme.

9. The private rented sector is increasingly the only housing option for many of our residents; it is one with a high proportion of privately rented properties containing significant hazards to health (category 1 hazards).6 We are not aware of the location of many of these sub-standard rented properties, both HMOs and single occupancy homes, and largely rely on tenants contacting the council with complaints or significant resources are spent locating them. Landlords can simply rectify the hazard without facing any legal penalty.

10. Currently the law does not require landlords to keep their properties free from category 1 hazards or to register them with the local housing authority. The council would therefore support the introduction of regulation in regard to privately rented properties and the need for them to be free of category 1 hazards in order for them be to legally let.

The regulation of landlords, and steps that can be taken to deal with rogue landlords

11. The council has a voluntary landlord accreditation scheme which has been in existence for approximately eight years. The scheme has 97 subscribed landlords owning 260 rental properties and approximately 200 HomeRun landlords pass ported onto the scheme that provide around 400 rental properties to students. This represents 7% of the10,000 privately rented properties across the city. There has been very little take up of the scheme over the last few years due to the lack of incentives for landlords, combined with the fact that many own properties across a number of local authority districts.

12. Membership of a landlord representative body provides an alternative to a local authority scheme but nationally only approximately 1% of private landlords subscribe to such associations. These bodies, whilst supporting the development of landlords in their knowledge of their responsibilities, do not provide local authorities with information on where properties of poor condition are located. Nor do the majority of private landlords operating in the market belong to these membership bodies.

13. Therefore, the council is in support of some simple/light touch regulation for landlords of privately rented properties. This would include some requirement to sign up to a local or national landlord register, and to comply with some simple checks with regards to provision of relevant safety certificates, the condition and management of properties.

14. As stated previously, the introduction of regulation with regards to the letting of properties with category 1 hazards combined with a landlord register would significantly increase the ability of local authorities to target resources and take enforcement action. We believe this would result in an increase the standard of privately rented accommodation, and allow local authorities to appropriately target those landlords who knowingly flout regulation.

15. At a recent meeting of the council’s Private rented sector working group,7 there was support from landlords and the Eastern Landlords Association for the introduction of a local landlord register.

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

16. The current mandatory HMO licensing system is onerous and requires a disproportionate amount of resource to administer in relation to other non-licensed HMOs; it applies to 8% of HMOs in Norwich. Whilst these HMOs are deemed to be of higher risk, our experience is that poor management and the existence of other risks such as a lack of adequate heating is just as likely in a smaller HMO not currently covered by licensing. A major fire that recently took place in a local HMO comprising of three people over two stories highlights that there remains significant risks in all types of HMOs.

17. In the main, sub-standard HMOs remain hidden unless their tenants complain or significant resources are spent locating them. The council is currently examining the case for additional licensing of HMOs in Norwich. We believe that it can go some way towards addressing this since landlords are required to identify the properties, will have to provide information to help with targeting inspections and can be required through conditions to keep them free from category 1 hazards.

18. However, as we have seen nationally, introducing additional licensing schemes can often lead to challenge, and their success is very much dependent on the local authority’s ability to resource them. In addition, there is a risk that the council is perceived to be creating a disincentive to landlords providing HMO accommodation, creating a further burden for tenants by increasing rents, which for many are already difficult to pay. The average monthly private sector rent for a one-bedroom property is £486.25 compared to a Local Housing Allowance rate of £400.01.

19. We believe that some form of simple/light touch regulation for landlords of privately rented properties would be more appropriate for HMOs and the private rented sector as a whole. This would include some requirement to sign up to a local or national landlord register, and to comply with some simple checks with regards to provision of relevant safety certificates, the condition and management of properties.

Conclusion

20. To conclude, the council believes that there are a number of measures that can be taken which would significantly help to address overcrowding and poor conditions by enabling inspections to be targeted and providing meaningful sanctions for landlords who let sub-standard properties. These measures include the introduction of a mandatory landlord register, regulation with regards to the letting properties free of category 1 hazards and flexible local schemes for all properties in the private rented sector, not just HMOs.

January 2013

1 Census 2011

2 English Housing Survey (Households) 2010–11, DCLG, 2012

3 The age threshold for the shared accommodation rate increased from 25 to 35 in January 2012.

4 Census 2011

5 There is a need to update our current research into housing need and the condition of private sector housing in Norwich and the research will be undertaken during 2013–14.

6 Category 1 hazards were present in 14% of privately rented dwellings compared to 9% in the private sector as a whole, Stock condition survey 2006.

7 The council’s Private rented sector working group comprises of representatives who have an interest in the private rented sector market; membership includes private landlords, Eastern Landlords Association, National Landlords Association, The University of East Anglia Student Union, Shelter, LandlordLaw, Association of Registered Letting Agencies and council officers. Private tenant representation continues to be sought.

Prepared 16th July 2013