Considered in Grand Committee
That the Grand Committee do consider the Licensing of Houses in Multiple Occupation (Mandatory Conditions of Licences) (England) Regulations 2018.
My Lords, the regulations being considered were laid before the House on Thursday 15 March 2018. The private rented sector is an important part of our housing market, housing 4.5 million households in England. Houses in multiple occupation, or HMOs, form a vital part of the sector, often providing cheaper accommodation for people whose housing options are limited. However, HMOs sometimes pose greater management challenges than single household accommodation, and some of the occupiers of HMOs are the most vulnerable people in our society. That is why mandatory licensing of HMOs was introduced in 2004 for properties with three or more storeys that are occupied by five or more people.
Since its introduction over a decade ago, mandatory licensing has been successful in raising standards and enabling local authorities to tackle overcrowded conditions and poor management practices. However, over the past 10 years, the private rented sector has doubled in size, which has led to increasingly small properties being used as HMOs.
As these smaller HMOs were not subject to mandatory licensing, some rogue landlords have been able to avoid local authority detection and enforcement by letting HMOs with fewer than three storeys. Poor practice by these landlords has led to negative harmful impacts on some local communities through the accumulation of rubbish and waste, as well as noisy and anti-social behaviour outside HMOs. It is to address these problems that the Government have extended mandatory licensing to properties of fewer than three storeys. We have already laid the Licensing of Houses in Multiple Occupation (Prescribed Description) (England) Order on 23 February 2018; it will come into force in October 2018. We are working with local authorities on producing guidance to ensure they are able to meet this date.
In addition to extending mandatory licensing, the Government are creating two new mandatory HMO licence conditions to address problems which are common in these types of properties. These conditions are on national minimum sizes for rooms used as sleeping accommodation and a requirement to comply with council refuse schemes. These new mandatory conditions are the subject matter for debate before the Committee today. It may be helpful for noble Lords if I outline briefly each mandatory condition in turn. I will begin by setting out the proposed requirements for minimum room sizes for sleeping accommodation.
By amending Schedule 4 to the Housing Act 2004, the regulations will require local authorities to include a new condition within licences. This would require a landlord to ensure that the floor area of any room in the HMO is not less than 6.51 square meters, if used as sleeping accommodation by a person over the age of 10 years. This minimum room size is just that: a minimum. It is simply a standard below which a room cannot be used as sleeping accommodation. It is not intended to be the optimal room size. Local authorities will still be able to set minimum sleeping room sizes above that minimum, which reflect the layout, space and amenities in the HMO in question. These can of course be greater than 6.51 square meters when used by one person over the age of 10 years. This will be important, since local housing authorities will need the discretion to set a room size that reflects the conditions of housing stock within their local areas. However, it is important that there is a clear minimum room size in HMOs. The introduction of this condition will ensure a consistent minimum that is applied nationally, across different types of HMO in the sector, and clarify a standard that we would already expect landlords to comply with.
The regulations also clarify minimum sizes for rooms used as sleeping accommodation by children under 10 years of age and by two persons aged over 10. A landlord will have to ensure that any room used as sleeping accommodation by a person under 10 years is not less than 4.64 square meters in size; if a room is to be used as sleeping accommodation for two adults, it must not be less than 10.22 square meters. In granting licences, local housing authorities will have to specify the maximum number of persons who may occupy the specified rooms as sleeping accommodation. It will be a local decision as to whether a room is appropriate to be occupied by three or more adults as sleeping accommodation.
Non-compliance with the minimum room sizes is a serious matter. If a landlord knowingly breaches the condition, that landlord will be liable on conviction of a criminal offence. Conviction on indictment could result in an unlimited fine; alternatively, a civil penalty of up to £30,000 may be pursued. We know that most landlords are honest and trustworthy. There is no intention to criminalise landlords who do not deliberately create overcrowding or to displace tenants without warning. We have introduced transitional arrangements to give landlords time to comply with the new requirement and rectify overcrowding specifically to protect tenants who may otherwise be jeopardised by bringing these regulations in over too quick a timescale.
Local housing authorities must allow a reasonable period for the landlord to meet the requirement. This will be a period of up to 18 months before it considers prosecuting the landlord for breach of the licence condition. The landlord must be notified of the breach and the length of time they have to meet the requirement. Those HMOs which are already licensed will have to comply with the condition only when their current licence expires, and at the first renewal after 1 October 2018.
Turning to the household waste disposal facilities part of this order—the second new mandatory conditions that these regulations create—a new mandatory condition will need to be included in HMO licences requiring the landlord to comply with their local authority refuse storage and disposal scheme.
The purpose of this condition needs some explanation. People living in separate households in HMOs tend to generate more rubbish than is seen in single-household properties. While tenants should be responsible for properly disposing of their rubbish, they need adequate and accessible receptacles to do so. Making this a mandatory condition of licensing means that local authorities will have proactively to require landlords to provide waste disposal facilities in circumstances where there is a scheme. It will also provide councils with the necessary enforcement powers if landlords are not complying with waste disposal schemes.
We anticipate that the vast majority of landlords will already be in compliance with the new conditions since the minimum room aspects of these regulations simply clarify existing space standards under Section 326 of the Housing Act 1985. We consulted extensively on the introduction of minimum room sizes for sleeping accommodation along with the requirement to comply with council refuse schemes in 2015 and 2016. These regulations should therefore come as no surprise to local housing authorities or landlords. For those landlords not in compliance with minimum room sizes, there is a transition period.
I am very much of the opinion that these are necessary conditions to beef up the HMO regime and I commend these regulations to the Committee. I beg to move.
My Lords I remind the Committee that I am a vice president of the Local Government Association. The regulations have my entire support. This is a very welcome change. I have one question for the Minister, which I have raised on previous regulations. It takes a very long time to effect change—it is three years since the initial consultation took place in May 2015—and I wonder whether things might be speeded up a bit. We have to consult carefully on the regulation to get the right outcome, nevertheless it does seem to take a very long time.
It has to be right that local authorities can regulate the minimum size of rooms that may be occupied as sleeping accommodation. It has to be right that the local housing authority can specify the maximum number of persons who may occupy a specified room for the purpose of sleeping accommodation in that licenced HMO. It has to be right that local authorities can make schemes in respect of refuse storage and disposal that a landlord would have to implement. In all those respects this regulation has to be right.
There was a time when the definition of HMOs was adequate. They were of three or more stories and were occupied by five or more persons forming two or more households. That was for many years a standard definition that stood the test of time. The difficulty now is, as the Minister said, that the private sector has grown to the point where it represents one in five household tenures in the UK, and standards have slipped. We have HMOs which, as the Explanatory Memorandum makes clear, are under the radar, and something has to be done about that.
I understand that there has been some debate about a reasonable minimum size for sleeping accommodation. As the Minister made clear, 6.51 square metres for one person over the age of 10 is a minimum size, not necessarily a desirable size. Indeed, it is actually very small. If you calculate that in your own mind, it is not very big at all. I understand that there are some residential landlords who would like all the accommodation in a HMO, which might include communal accommodation, to be calculated as part of the minimum amount. It seems to me that sleeping accommodation, which is the private space of an individual in an HMO, has to be of a reasonable size for someone to do things other than just sleeping. Therefore, I find 6.51 square metres small. I do not think it reasonable to say that we should include communal accommodation and reduce the amount that is required under the law for sleeping accommodation.
With reference to paragraph 7.9 of the Explanatory Memorandum, I wonder whether the period of 18 months’ grace is too long. For a while, I felt that once this has been approved, giving landlords a year, or perhaps nine months, would be adequate. Given the fact that it may prove complicated for local authorities to identify, investigate and agree with landlords what will happen, a period of 18 months is probably justified. When he replies, can the Minister explain the basis for the 18-month period as opposed to any other?
These regulations are very welcome. They help us to solve a problem. Where standards in the private rented sector are declining, they give local authorities powers to act to protect the interests of tenants. They should therefore be commended.
My Lords, these are important regulations before the Grand Committee. I, too, declare my interest as a vice-president of the Local Government Association.
I do not know whether any noble Lords here have ever lived in an HMO. I certainly have not. My honourable friend in the other place, Melanie Onn, and I were work colleagues in the Labour Party; she lived in an HMO as a young homeless person and she will tell you what conditions were like there. She has some knowledge about this. These regulations are important and I am very happy to support them; they certainly go in the right direction, but there is a lot more to do.
I have also been out in Newham on a number of housing raids. Of course, Newham has a licensing scheme, but the standard of accommodation some people are expected to live in is absolutely shocking. The regulations are a step in the right direction, but we must never lose sight of the poor accommodation that we have and expect some people to live in. I support improved rights and protections for renters; the regulations will go some way to improving the rights of some of the most poor and vulnerable people in our communities.
We have had discussion of the national minimum room standards. As the noble Lord, Lord Shipley, said, the room allocated to someone in an HMO is not just a bedroom. Other than the shared bathroom and kitchen, you need a bit more space to put a bed and a wardrobe in. This must be taken into account when concluding that the proposed minimum standard for a single occupier should be 6.51 square metres or 10.22 square metres for two people. Those sizes will be further compromised if young children are there as well.
Some local authorities may seek to provide larger minimum space standards in their licensing schemes, which is good. However, we need to consider carefully that these rooms are not just bedrooms. They are your bedroom and living room. They are the room where you put all your property. Everything you have in life goes into this one room. I certainly think that we have to look carefully at size there.
The Minister mentioned fines for letting out rooms that are smaller than the minimum, which is good. However, we must make the point that we can have all the regulations we like, but it becomes an issue when we cannot enforce them. The other issue with HMOs, particularly when they are very small or even illegally let, is the danger of overcrowding and overcluttering, which creates a fire risk and other problems that people get into in insufficient spaces.
Ultimately, we need to think also about issues such as the impact on mental health. You have to remember that people are letting one room and are sharing the building with people they do not know. Often, they will lock the door to their room at night, and that is not a great way to live your life. These are some of the most vulnerable people and there are real issues here, in particular for their mental health.
That leads on to the wider problem of a housing market in crisis, which we have talked about many times in this House and elsewhere. The standard and quality of some of the accommodation that people live in is shocking and we need to do much more about that.
I have to mention the dreaded Housing and Planning Act 2016, which offered little respite to people in this housing crisis. We need always to be on top of this. I support the regulations because they are a move forward, and I thank the Government for that, but we need to do much more. I am not sure if the Minister has been out to look at the situation, but I can recommend that he do so with Newham Council. He would find it shocking—I was last out with the council in February. For people to be living like that in HMOs in 2018, in one of the richest countries in the world and one of the richest cities in the world, is truly unbelievable. I am very happy to support the regulations before us today.
My Lords, I thank both noble Lords who speak on these issues on behalf of their parties. I thank them for their general approach, which is consistently responsible and, at the same time, questions aspects of the policy, which I fully understand.
I will deal first with the points made by the noble Lord, Lord Shipley. One thing that the noble Lord, Lord Shipley, the noble Lord, Lord Kennedy, and I have in common is that we always want these things to happen more quickly than appears deliverable. I understand, therefore, where the noble Lord is coming from when he talks about how long these things sometimes appear to take. We have touched on the fact that both noble Lords carry out visits to communities at the sharp end to see what is necessary, and similarly I have been to Sheffield and Luton and seen some of the problems that exist there, which are by no means unique. Tomorrow, I am in Leeds and Hull, and on Friday I will be in Bradford, and I expect to get similar messages there.
I thank the noble Lord, Lord Shipley, for what he said about the broader definition of HMOs that we have already brought in to take into account properties of three storeys and below. As a Government and as a country we have to be fleet of foot to change our definition in the light of new circumstances so that, as he said, things do not go under the radar. I accept that 6.51 square metres is relatively small, but, my gosh, he and I know that it is a massive improvement on some of the things that are happening now. As he rightly said, we must make sure that we focus on enforcement to make sure that these and other regulations are properly enforced.
The noble Lord, Lord Shipley, asked whether the 18-month period is appropriate. When I saw it, I also thought it seemed to be a long time. However, one needs to remember that this is not, primarily, to protect landlords. If anything, it is to protect tenants, some of whom I accept are currently sleeping in a space that is too small. However, we do not want those tenants to be forced out by a landlord saying that he has to do so because it is the law. The transitional period takes into account landlords to a degree, but, much more so, tenants as well as local authorities. Probably, 18 months is about the right period.
The noble Lord, Lord Kennedy, mentioned Newham Council, which I know does much good work. I will, when possible, visit Newham to see what is happening there. He made the justifiable point that this issue has far-reaching implications for mental health, a point which, I must confess, I had not homed in on. He is absolutely right. In a sense, I lived in a HMO as a student, but that is a very different experience from living in a HMO as an adult, particularly with children, and I understand what the noble Lord is getting at. It is not a desirable position in many situations. It may be appropriate for people on a transitional basis but it is not how most people would opt to live; I fully accept that. However, given that some people are in that position, we have to make sure that there are appropriate regulations.
I thank again the noble Lords for their comments and for their general support. I commend these regulations to the Committee.