HMO sector will see a rise in criminal landlords exploiting tenants

The scale of unlicensed Houses in Multiple Occupation (HMOs) across London, revealed in a BBC investigation, could get worse when the Renters’ Rights Bill becomes law.

That’s the view of Sean Hooker, the head of redress at Property Redress, who was responding to the TV programme.

Viewers saw tenants facing hazardous and overcrowded living spaces as criminal landlords exploited vulnerable tenants.

In doing so, they are sidestepping licensing rules that law-abiding landlords must follow.

Rise in creative criminal practices

Mr Hooker said: “There is an ongoing need to help educate tenants about their rights, where to access help and to reduce the fear that making a complaint will leave them homeless.

“We know that when rules are tightened, the worst offenders simply find new ways to bypass them.

“Once the Renters’ Rights Bill becomes law, it is likely we will see a rise in creative criminal practices such as sham licences, illegal subletting and exploitative rent-to-rent arrangements.”

He added: “Until we can clearly distinguish between what a safe, transparent and well-regulated sector looks like, and shine a beacon on this, the rogue element will continue to operate in the shadows, endangering tenants and destroying the reputation of those who play by the book.”

Unlicensed HMOs numbers rocket

The programme, fronted by reporter Tarah Welsh, shed light on a murky corner of the PRS where in some London boroughs, unlicensed HMOs outnumber those that are legally registered.

One borough reported 3,000 licensed HMOs but suspects the true figure could be double or triple that.

In Newham, an expert estimated more than 700 unlicensed properties in an area with just 75 registered ones.

Similarly, Tower Hamlets may have 500 illegal HMOs in a single area, compared to only 50 listed, while Southwark’s Old Kent Road could have more than 300 illegal properties against 232 licensed ones.

Licensing raises standards

Mr Hooker said: “Licensing schemes are increasingly common and, where properly enforced, they have raised standards.

“However, this depends heavily on how well local authorities are resourced and how effectively they work with the rental community to create a collaborative and cooperative landscape, one that fosters compliance and creates a hostile environment for those who choose to break the law.”

He added: “The proposed private rented sector database, which will require all rental properties to be registered nationally, has huge potential to make a difference if rolled out effectively.

“Better data sharing would enable authorities to focus on where criminality is going under the radar.”

Challenges facing the PRS

Mr Hooker continued: “This demonstrates the extent of the challenges the sector faces.

“While it represents a small fraction of the overall rental market, private renting now forms such a large part of housing supply that the actual numbers involved are frightening.

“The BBC’s findings, uncovering the shocking conditions many tenants endure, highlight just how urgent this issue is.”

He added: “Given the chronic shortage of housing, the economic and affordability issues faced by renters, it is all too easy for the unscrupulous to exploit vulnerable tenants.”

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