In Defence of Liberty

Driven by data; ridden with liberty.

Update on Bath’s Article 4 Direction and HMO Licensing Scheme

The Housing and Major Projects Policy Development and Scrutiny Panel held a meeting on Tuesday 19th March in the Council Chambers at Guildhall. Updates were given on the proposed Article 4 Direction in Bath, which will take away permitted development rights, and the planned HMO licensing system, requiring all landlords of HMOs in a subsection of Bath to hold a license for their property.

Bath & North East Somerset Council's Cabinet will make a decision on the Article 4 Direction in June. (Photo: stevecadman)

Bath & North East Somerset Council’s Cabinet will make a decision on the Article 4 Direction in June. (Photo: stevecadman)

Planning Permission

A presentation was given by a council officer on the council’s current stance on the Article 4 Direction. She said that over 35 cities have or are seeking to implement an Article 4 Direction, and the council wants it to be applied to the entire city of Bath. The Supplementary Planning Document (SPD) states that planning permission will be rejected if the surrounding houses in a 100m radius are more than 25% HMOs. The consultation on the SPD will be published in June. The Cabinet meeting in June will decide whether to implement the Article 4 Direction and adopt or amend the SPD. This policy acts as a “compliment” [sic] to the Additional Licensing Scheme.

A councillor asked what percentages of HMOs are used by students. The officer responded that roughly 60% of HMOs are rented by students. The council is currently unsure about the total number of HMOs, but that the council has a “good idea”.

Asked to provide an update about the Additional Licensing Scheme, the council’s Associate Director for Housing opened that the scheme will increase the scope of HMO licensing to include smaller properties, and about improving housing conditions. Before this scheme is introduced, the council needs to jump “a legal hurdle”: providing evidence and consultations. Numerous changes have been made to the scheme, as a direct result of the consultation. A new fee structure had been introduced, giving discounts to accredited landlords. The scheme will also recognise converted garages, rather than outlawing them. The affected area has been cut. A discussion ensued between the councillors and the officers about the various aspects of the HMO licensing scheme. I gave the subsequent speech to the Panel nearing the meeting’s end.

The strains on housing in Bath has caused discomfort amongst long-term residents. (Photo: grahamc99)

The strains on housing in Bath has caused discomfort amongst long-term residents. (Photo: grahamc99)

My Speech to the Panel

I would like to extend my thanks to the officers for their thorough report, and I would like to thank the councillors for the chance to speak. My speech will focus on the nature of the problem with HMOs and the efficacy of the proposed solution.

The council is unsure about how many HMOs there are in Bath, and believes their previous estimates may be understating the total amount by 50%. The original evidence report has a graph showing a correlation between a ward’s supposed number of HMOs and the number of domestic waste complaints and street sweeping requests. However, the Housing Act 2004 demands local councils must collect evidence on the “HMOs of that description”, that is, what type of HMO the council wishes to license – HMOs with shared facilities. It is noted “no correlation was found between HMOs with shared facilities and service requests.” The report then states a correlation is recreated when you remove the wards of Kingsmead and Abbey, but no proper reason is given for their exclusion.

Despite B&NES Council’s concerns, a survey of HMO tenants found that they are broadly happy with both their rented property’s quality and management. This same survey found that 24% of HMO tenants were ‘not well informed at all’ about Council Services, and 31% did not know how to complain about their property’s condition.

The additional licensing system in Cardiff has been highlighted, but this licensing system only covers the Cathays ward. Their licensing system has major issues with its coverage and enforcement. After two years in operation, the scheme at most covers 60% of the HMOs in Cathays. Cardiff Council serves notices on licensed properties to initiate improvements.  It has served 356 notices relating to security, but only 36 were complied with.

Similar problems of coverage and enforcement may be observed in the first citywide additional licensing scheme in Oxford. In its first 10 months, Oxford City Council has received 2,541 applications for licenses, issuing 1,397 licenses under their scheme. After many erratic estimates, they believe there are 5,069 HMOs in Oxford. Combined with 551 mandatory licensed HMOs, Oxford’s scheme has covered 38.4% of the city’s HMOs in the infant scheme’s first 10 months. Despite the existence of about 2,000 unapplied HMOs in Oxford, there have only been 26 concluded court cases fining landlords for not having a license.

Landlords are charged by the council for their licenses, and that money is then used to fund the licensing scheme. With little enforcement, the new licensure may not capture enough licenses to sustain it, and so it cannot fulfil its purpose. A coagulated revenue flow leaves the licensing system whirring and spluttering; its corroded machinery is a distant design from the sleek shimmer promised in manifestos and council reports. In order to divert funds to regenerate the additional licensure, the council would have to make cuts in other areas, erode the council’s monetary reserves or raise council taxes.

Ultimately, licensing is a trade-off: the increase of both accommodation quality and management, in exchange for higher rents and less competition between landlords. Given that Bath has some of the highest rents in the country, this balance should be carefully considered. The problems with HMO management in these wards appear to be quite particular and isolated. There are major problems with infant licensing systems, as they fail to cover the licensed area and the new rules are weakly enforced: only the future will reveal if these serious issues are ameliorated. For now, the local council should continue to use their accreditation scheme to raise housing standards. I would like to apologise for the massive simplification that was required in turning a 20 page report into a three minute speech.

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