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Tenants in shared homes face possible rent increase / 02.10.2018

Tenants in shared homes face possible rent increase image

A change has been made to government rules regarding tenants living in shared homes, which has given rise to concerns about possible rent increases which will leave many tenants struggling to pay.

The government have stated that the new rules would raise housing standards for an additional 850,000 more people in privately-rented homes.

Until yesterday (Monday 1st October 2018) only houses that had more than 3 storeys and contained five or more people, forming at least two households, had to be licensed.

An additional 160,000 houses in multiple occupation (HMOs) are now required to be registered with local councils, as the new rules have removed the three-storey threshold.

HMOs are homes shared by unrelated people, where each person sleeps in their own room, but shares a kitchen and a bathroom.

The majority of the people living in these circumstances are students, migrants and low-paid workers.

The additional costs for landlords involved in licensing are expected to be passed on to tenants in the form of increased rent.

The Centre for Economics and Business Research estimates the rule changes will leave landlords with additional costs of more than £95m.

The cost of renting a room has risen at twice the rate of salaries in the last three years, leaving already financially stretched tenants even more concerned about additional future increases.

The average cost of renting a room in England in 2017-18 was £385 a month.

Ben Clay, from Tenants Union UK has said that he welcomes the new legislation, but feels that there is still much further to go in that all rented accommodation should be subject to regulation, to ensure higher standards.

He also called upon landlords who are considering passing these new costs on to their tenants to think again as; "Renters are already facing a perfect storm of rent increases at a time when more people have to deal with shrinking wage packets”.

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