Published 3rd October 2019
We’ve seen a strong start to October in the PRS (Private Rental Sector), with The Times conducting a series of investigations highlighting the lack of regulation in the PRS and the promotion of properties for rent with a blatant disregard for Property Licensing, planning legislation, and building regulation, in the capital.
The article below summarises these news stories issued in The Times on 30th September. With a focus on online portals, the report highlights the lack of council regulation in the PRS and how this is impacting the standard of available accommodation marketed to tenants.
Some of the latest property portal start-ups to enter the PRS have remained noncompliant and unregulated – despite being online and available for council’s to view.
‘Uber of property’ Spotahome displays little regard for rules
The “Uber of property” Spotahome has been highlighted in The Times with recent images published showing examples of a partition wall cutting in half a radiator to split a one room flat into a two-room flat to increase the landlord rental.
The fact that these properties are online and being promoted to tenants in a variety of council areas UK wide, has created serious questions as to why councils are not clamping down on these property websites. The report highlights how advertising properties that are unfit and non-compliant, is putting tenants at risk in the PRS. The Times analysis of a random selection of 100 rooms in five-bed homes found that only 12% had the necessary licence required on the relevant local authority’s register.
Labour MP Clive Betts said: “These websites should also be answering questions about facilitating illegality. I think it is disgraceful if a company is making huge amounts of money out of the housing crisis.
“We might need to follow up our committee’s report on the private rented sector and see how much progress councils are making on taking action, and what the government is doing to drive this issue.”
Chief executive of the housing charity Shelter, Polly Neate added: “Solving this problem demands a two-pronged approach: councils need more funding to be able to clamp down on law-breaking landlords and we also need a decent alternative to private renting. That alternative must be social homes – three million of them in the next 20 years.”
Generation rent are giving up their living rooms
Another article highlights, again with images, how a property living room was turned into a double bedroom with a bed dangerously close to an open gas fire. The Times investigation discovered that “nine out of ten house shares in some areas (are) being offered without (a) communal living space”. Many of these appear to be ignoring building regulations put in place for the safety of tenants.
Pressure for tenants to pay £250 just to see a room
Another article explains how a tenant was treated when looking to view a rental property in London’s Dockland’s with online estate agent ApartmentWharf. Firstly in order to view the property the article states “To see the room in person, however, I would have to pay a reservation fee of one week’s rent, which for a double room ranged from £250 to £320.” If the property was not agreeable, then a further £99 could be paid to view another property.
Yet at this time the tenant would not have the opportunity to meet the other tenants in the flat before agreeing to the rental, and there was a possibility that locks on the bedroom doors may not be agreed with the landlord.
There are many issues this article touches on such as tenant wellbeing and mental health, the fact that tenants sit in their bedrooms to eat dinner because the communal space is now converted into other bedrooms. Also, the stress associated with moving into a property without meeting fellow tenants and being put under undue pressure to pay over a large sum of money to even view a rental property. All of which shows the state of the housing crisis experienced –across the UK and not exclusively to London.
Cityrooms booms as it promises long term rents for landlords
Cityrooms.com has generated more than £56 million in the past three years by promising landlords guaranteed, long-term rents and then subletting the individual rooms. One of the conditions is that the landlord must agree to allow Cityrooms to put up partition walls to create new bedrooms. However, this is resulting in many of its 243 rooms cited in The Times (241 as at 1st October 2019- potentially post publication of these articles) being in properties with no living room or communal space. That said, there is no current legal requirement to provide such a space.
The Times investigation analysed a random selection of five Cityroom properties, and found that none had a licence on the local authority register of homes in multiple occupation. Some it claimed were in the process of being granted licenses, others listed by mistake.
There is no shortage of review sites to view the experiences of disgruntled and unhappy tenants who have experienced first hand the service from Cityrooms.
Spareroom HMO properties are not routinely checked
Licensing is mandatory for rental properties with five or more unrelated sharers. The Times analysed 100 rooms offered in five-bedroom properties on the most popular house-share website and found that only 12% were registered as approved HMOs.
Spareroom told The Times that checking every property is not straightforward because there is “no central database and each council holds the information differently.”
The Times also quotes an un-named traditional letting agent who said he had reported half a dozen unlicensed HMOs to several councils six months ago but had heard nothing back.
Lots more to come it seems on property licensing schemes this year. To find out how Kamma can make licensing easy and simple for your organisation, click here
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