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Good Practice in the Use of Licensing Schemes for Houses in Multiple Occupation in Scotland - Research Findings

DescriptionThis research was commissioned to evaluate current practice with discretionary schemes with a view to producing good practice guidance for the implementation of future mandatory licensing.
ISBN
Official Print Publication Date
Website Publication DateDecember 24, 1998
THE SCOTTISH OFFICE CENTRAL RESEARCH UNIT
Development Department
Research Programme
Research Findings No 56
Good Practice in the Use of Licensing Schemes for Houses in Multiple Occupation in Scotland

Hector Currie, Hilary Third and Madhu Satsangi (School of Planning and Housing,
Edinburgh College of Art/Heriot Watt University)

Alison Brown (Scottish Council for Single Homeless)

In 1991, local authorities in Scotland were granted discretionary power to establish licensing schemes for Houses in Multiple Occupation (HMOs). To be eligible for licensing, an HMO must be occupied by more than four persons, not all members of one or two families. In the light of a government manifesto commitment to require all local authorities to introduce a licensing scheme, this research was commissioned to evaluate current practice with discretionary schemes with a view to producing good practice guidance for the implementation of future mandatory licensing.

Main Findings

  • At October 1997, only seven local authorities (including the four cities) operated a discretionary licensing scheme and only 287 HMOs had been licensed by that date. Only one authority believes that it has licensed most, if not all of the licensable HMOs.
  • The reasons for the low achievement are numerous: inadequate staffing and financial resources, lack of priority relative to other activities, problems with using civic government licensing procedures, problems with corporate working and inconsistency with other powers and statutory requirements.
  • No licensing authority has developed a private rented sector strategy that links HMO licensing and its market impact to issues of supply and demand for rented accommodation.
  • Most landlords of licensed HMOs support the principle of licensing but are very critical of the administration of schemes, in particular poor co-ordination between departments and high fees.
  • Most authorities took no steps to actively liaise with HMO tenants at licensing introduction or during inspections and have not incorporated tenancy management criteria as conditions of licence.
  • Tenants are generally satisfied with the quality and management of their accommodation but are unaware of specific benefits from licensing, other than improved fire safety features. Almost all think the idea of licensing is good and would make landlords more accountable.
  • Most of the authorities without discretionary schemes do not think they have sufficient HMOs or problems to justify a scheme. Most operate only a reactive enforcement service and give HMOs a very low priority.

The Discretionary Schemes

Publicity about the establishment of schemes was generally quite limited. As well as the statutory public notice, authorities wrote to landlords of whom they had records. Some authorities also organised local press and radio articles, posters in the local library and leaflets in student halls of residence. Specific information material for tenants was negligible in all but one authority.

All authorities emphasise the importance of licensing private rented sector HMOs. They exclude shared accommodation registered under the Social Work (Scotland) Act 1968, but there is no overall consistency in the other categories included or exempted. University student halls of residence, non-registered, shared accommodation managed by voluntary organisations or housing associations, council owned hostels, and women's aid refuges are included in some authorities' schemes - but not in others.

Inter-departmental, inter-agency working groups of officers are not commonly used except in Glasgow and Edinburgh. Informal liaison arrangements between departments and with the Fire Service are more the norm but they vary in their effectiveness. Liaison does produce efficient, co-ordinated property inspections but this opportunity is not consistently taken up and independent HMO inspections are common. Except in Edinburgh, there is no involvement by the housing service in HMO licensing casework.

Ensuring that planning and building requirements are met is very important but, on occasions, this delays licensing, either because no clear HMO planning policy is established or because major upgrading works under building warrant or listed building consent have not been achieved within the timescale of six months.

Securing efficient action is at times adversely affected by disparities between the thresholds and definitions for licensing, planning and building regulations which add to the complexity of inspections, standards and enforcement.

The main licence conditions relate to property standards and fire safety. Conditions about the standard of landlord management of the tenancies are applied by only two authorities. Only one authority actually assessed these conditions.

Licence renewal periods vary from one to three years across authorities, although one year renewable licences are the most common. Similarly, the frequency of inspections vary from one to three years. Licence fees vary widely across authorities from as low as a first time fee of £35 to as high as £435. Authorities have not calculated the actual costs of overall licensing administration but in no case is the fee income considered to cover costs.

Landlords' Experiences

Most landlords have only one licensed HMO and own and manage it themselves. The great majority are, in principle, in favour of licensing but are very critical of how it is currently operated. Their main concerns are:

  • Many HMOs and their owners, including the worst, are escaping licensing.
  • The inconsistency between classification for licensing and for council tax or planning purposes.
  • Too many visits by officers and placing the onus on the licensee to co-ordinate visits.
  • Inconsistencies between and within departments on standards.
  • Poor communication of requirements and procedures.
  • The intrusiveness of site notices, particularly when required annually.
  • The discretion apparently given to individual officers that can lead to inconsistency.
  • Annual renewal and inspections which are unnecessary if no changes have been made.
  • The high fees, particularly for renewals, in Edinburgh and Glasgow.
  • Attending the licensing committee is time-consuming and can be intimidating.
  • The increasingly stringent, sometimes unreasonable, demands made by authorities each year - particularly in respect of standards for older properties.

Only a quarter feel that licensing has altered how they manage the HMO. Very few have increased rents as a result of licensing, other factors being more influential. Most landlords believe that licensing would lead, or already has led, to a reduction in 'good' HMOs.

Tenants' Views

Most of the tenants interviewed were single person households, mainly under 40. About half were unemployed, the other half were students or working. Lengths of stay in the current HMO vary widely between 2-3 days and nearly 10 years. There is a wide range of reasons for moving into their current accommodation; these may be necessity due to the lack of choice, alternatively preference due to positive features of the accommodation or its location. Only a few have clear plans about moving in the future and some are very settled.

The great majority of the tenants have positive views about the standard of their accommodation and speak very favourably about their landlord's management, particularly his accessibility to deal with repairs and problems. Those who are not enamoured of their landlord complain about lack of contact and unwillingness to spend money to carry out repairs and maintain the standard of the property.

Only half of the tenants are aware that their HMO is licensed and few are conscious of any observable changes as a result of licensing. However, despite this, almost all think the idea of licensing, as a means of dealing with bad landlords, making landlords more accountable and ensuring good standards, is worth pursuing.

Non-licensing Authorities

The local authorities with no licensing scheme fall into two groups. Over two thirds have few HMOs (as far as they know), few or no problems with them and operate a reactive service. The remainder indicate they have larger numbers and more problems. This leads to more formal liaison arrangements including, in some authorities, working groups of officers but these seem to meet very infrequently. Enforcement is more proactive and a number have registration schemes.

A variety of reasons is offered for not having introduced a licensing scheme: too few HMOs and too few problems, costs would be outweighed by the benefits, resources are increasingly scarce and have to be prioritised to higher risk work.

Nearly three-quarters of the authorities believe that introducing a mandatory licensing scheme would have little adverse effect on their staffing and budgets, or on the few HMOs they have in their area. However, the remainder are concerned that a mandatory licensing scheme would cause serious difficulties.

Conclusions

Examples of good practice are identified in several of the authorities but much of the study's recommended good practice is the result of an analysis of the problems experienced by authorities in managing and implementing their discretionary schemes.

The study expresses doubts about the appropriateness of civic government act licensing procedures to deal with HMOs and a range of issues are highlighted for the government to consider. It specifically singles out the benefits that could arise from developing an HMO risk assessment methodology in order to create a more rational and effective approach to licensing in the future.

About the Study

The study was conducted by means of case studies of all seven licensing scheme authorities and of 5 authorities without licensing schemes, a telephone survey covering a further 13 non-licensing authorities, a face-to-face survey of 30 landlords of licensed HMOs and a similar survey of 30 tenants living in licensed HMOs. The study brief did not include HMO property inspections to assess standards.

"Good Practice in the Use of Licensing Schemes for Houses in Multiple Occupation in Scotland", the research report summarised in this Research Findings, is available priced £6.00. Cheques should be made payable to The Stationery Office and addressed to:

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