26th November 2001

Members of the Association of Residential Letting Agents, ARLA, have exposed proposed regulation in the Private Rented Sector as valueless, a survey completed this month has revealed.

In a Private Members Bill, the Home Energy Conservation Bill, due for Second Reading in the House of Commons this week (30th November), Dr Desmond Turner is seeking to treat any private house or flat rented out to unrelated individuals as Houses in Multiple Occupation, or HMOs. 

Until now, HMOs have been commonly perceived as being either hostel style accommodation or bedsits but the Bill will try to impose on small private residences the same hotel-style licensing and building standards expected for genuine HMOs. This follows the introduction of harsh Scottish legislation for HMOs that is already driving landlords away from supplying the market for sharers.

According to the new ARLA survey, 13% of all rental properties are occupied by sharers in the tenancies that are arranged by ARLA member letting agents. This is thought to apply to at least a quarter of a million people renting through ARLA members alone. If the proposed legislation passes the Commons, most of these sharers will be required to move as their landlords follow the Scottish example and let only to couples or 'bona fide' families.

The survey also showed up the continuing failure of the Housing Benefit system. Agents report that three quarters of their landlords give instructions not to accept housing benefit tenants. This is due to the flaws in the system. It is not a reflection on individual applicants.

"Government priorities are all wrong," ARLA Chairman John Crossley told delegates at the ARLA Annual Conference last week when he revealed the results of the survey. "Since the Housing Act 1988, the Private Rented Sector has been running well and the ARLA blueprint for lettings established over the last 20 years safeguards the monies and the health and safety of tenants and landlords."

Mr Crossley pointed out that, according to the government's own research, tenants express greater levels of satisfaction with private landlords than either local authority or regulated social landlords. 

"Despite this, proposed legislation will make sharers homeless. The failure to clean up the housing benefit system will prevent a whole section of the population from having any choice in housing by proper use of the Private Rented Sector and private sector landlords will start worrying for no good reason, yet. This is valueless regulation," he said.

Mr Crossley also warned delegates that further regulation is likely to be introduced that will also upset the smooth running of the Private Rented Sector. Selective Licensing is proposed for the most deprived areas of the country. "As well as the fact that any hint of licensing will send the wrong signals to landlords everywhere, selectivity is impractical and, as it is discretionary, it is ripe for bureaucratic abuse. Selective legislation is simply scraping off the spots in an attempt to cure a disease. That, too, is valueless," Mr Crossley suggested. 

Editors Note: ARLA is the only professional organisation dedicated solely to the Private Rented Sector. It is estimated that members of the Association are responsible for arranging over 500,000 new tenancies each year. This is equivalent to some 40% of the lettings in the Private Rented Sector that are arranged through letting and residential managing agents.

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