Landlord Database will be introduced this year

Plans for Landlord Database for HMOs fully underway

The landlord database will store the information of landlords who have failed to comply to HMO regulations.

Lord Bourne, the undersecretary of state for communities and local governments, revealed that an official database of bad landlords and lettings agents will be launched in October 1st 2017.

Despite the launch of the landlord database in October, there will be some leniency for the first six months. This will allow time for landlords to get better informed about their councils HMO licensing and take action to properly upgrade their properties.

Lord Bourne broached the topic during a meeting in the Lords Chamber on the 8th of January.

We now know that the landlord database will contain the information of those;

  • found guilty of running a HMO without the necessary licensing
  • not complicit in ensuring the maximum safety standards required
  • continuing to charge agency fees

The above criteria is all that has been confirmed by the Department of Communities and Local Government. They have stated that they will begin a dedicated consultation period over the coming weeks. During this time the department will properly outline and define which offences will render the landlord or letting agent liable to be listed in the database. The offences are aimed at those who have or manage HMO properties within the private rented sector.

Though initially, the landlord database was to tackle just non-compliant HMOs. However, it seems that by tying in lettings agents who continue to charge fees the government is intent on taking on the entire industry with this database. From agents to one property landlords, the private rental sector is getting some serious governemnt attention.

What will the database mean? 

Exactly how the database will affect the landlord or letting agent in unknown. Suggestions however, are that those placed on the database could incur a suspension of up to a year.

HMO services London is following developments closely and will report new findings as and when they arrive.

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Changes to HMO Legislation are coming, make sure you are informed!

Existing HMO rules to change this year

HMO licensing currently encompasses 60,000 homes in England. The proposed changes to legislation will mean that a further 170,000 shared homes will be required to obtain a license. This license can only be obtained once the property owner has fulfilled all the requirements of their Local Authority.

The following blog will deal with the most impacting changes expected to come in this year. The Department for Communities and Local Government has now entered a consultation period to properly define the extent of the changes to the mandatory HMO licensing, however there are a few points which have been marked out as unavoidable.

1) The licensing will expand to include all HMOs with 5 or more sharers making up two households. 

An earlier Government consultation, in October of 2015, sent out an advisory questionnaire to organisations and individuals across the housing sector. Of the 449 respondents, 78% agreed that HMO licensing should extend to include larger houses regardless of the numbers of storeys. 48% went on to agree that houses with 5 sharers from 2 or more households should be HMO licenseable.

2) Flats above shops and businesses will also be HMO licenseable.

79% of those asked in the 2015 survey, believed that flats above businesses should be HMO licensed. Changes to this particular area are being considered because risk of fire is increased in these types of residences.

3) Landlords and Letting Agents will be expected to carry out criminal record and referencing checks more diligently – HMO or not.

This coincides with current government movements surrounding stricter enforcement of immigration rules. Since December 2016, new criminal offences have been created to penalize landlords who fail to undertake Right to Rent checks against their tenants.

4) Landlords and Letting Agents who do not obtain HMO license

The exact impact of being placed on the database has not been fully determined and I imagine we will know soon after the ongoing consultation period. It has been rumored that the database could mean landlords might incur a suspension of up to a year, though nothing has been confirmed.

5) Penalties of up to £30,000 are expected to be incurred for those who do not license their rental homes

The increase in the maximum penalty to £30,000 has come because it was believed the original maximum penalty of £20,000 did not work to deter landlords for not complying with HMO standards. In fact, it was understood that landlords simply incorporated the fines as typical business costs.

Act Now!

These changes will be implemented throughout the year with a grace period of six months before a penalty is incurred

In the meantime, check out the services offered by HMO Services London and arrange a initial consultation.