HMO landlords could pass licensing fee on to tenants through higher rents

A council has admitted a new licensing scheme for houses in multiple occupation (HMO) landlords could lead to them passing the cost on to tenants.

Bolton Council plans to launch a new licensing scheme for HMOs early next year, meaning nearly all HMOs in Bolton will require a licence to operate legally.

However, the council has admitted the £1,211 cost of the five-year licence could hit tenants in the pocket, with HMO landlords potentially passing the cost on through higher rents.

Pass on additional costs to tenants

In a press release, the council claim the long-term benefits of the licence will outweigh any short-term costs to landlords and tenants.

The press release said: “Some landlords may choose to pass on part or all of the additional costs to tenants via rent, but the long-term benefits are positive by improving the quality of housing stock, making local neighbourhoods safer, generating more local investment, and improve the health and wellbeing of residents.

“Good landlords will also benefit from rogue landlords being pursued and driven out of the market ensuring that everyone is operating to the same standards”.

Councillor Sean Fielding, executive member for Adults and Community Housing Services at Bolton Council, said: “Most landlords act responsibly providing good, safe and secure homes for residents, yet there are some who flout the law, cut costs to maximise profits, and put people’s lives at risk.

“Minimum property and maintenance standards are there to save lives, and it is unacceptable that landlords cut corners in critical areas such as failing to obtain fire, gas, and electrical safety certificates or ensuring properties are safe.

“Overcrowded HMOs can also damage once thriving communities, as tenants move on quickly and anti-social behaviour can flare up in the neighbourhoods.

“The new licensing will help tackle these issues, and when the council receives direct complaints, it will now have stronger powers to take action.”

£40,000 fine

According to Bolton council, in the past three years they have received more than 1,000 complaints about disrepair in rented homes,  typically relating to fire safety, cold and damp and overcrowding.

The council have warned any HMO landlords who fail to join the licensing scheme will face a £40,000 fine.