NOTTINGHAM CITY COUNCIL PROPOSES INCREASE IN HMO LICENCE FEES
Matt Jarram, Senior Digital Reporter and Crime Correspondent of the Nottingham Post, reported on Monday 11 January 2021 the reaction of landlords to the Council's proposals to increase the (controversial) licence fee for HMOs from April 2021, with landlords set to pass on the cost of the licensing scheme to tenants. ...
Controversial Nottingham City Council scheme could increase rent for thousands
Landlords set to pass on the cost of council's licensing scheme to their tenants
Thousands of residents could see their rent rise this year because of Nottingham City Council plans to increase a controversial licensing fee.
Landlords believe the cost will be passed onto the tenant with a possible five to six per cent increase a month on what they already pay.
For houses shared by three or more unrelated people, landlords must apply for a houses in multiple occupation (HMO) licence.
But Nottingham City Council is proposing to increase the cost of that licence from April, which means landlords will be paying more than £1,000 per property they own.
The licence is supposed to ensure that properties meet the required standard for tenants and allows council officers to carry out inspections.
But landlords argue that the council has not carried out any inspections due to the coronavirus pandemic and it is just a "money-making scheme".
HMOs are usually occupied by students and working professionals. If someone is paying £500 per month for a room, it is likely the rent will now rise by five to six per cent.
Tom Tomlinson, managing director of student estate agent, Tomlinson Estates in Lenton, told Nottinghamshire Live: "This is hard to hear. We don't get value for money.
"We get one inspection by the council to tell us to do very little. The good landlords are getting harassed for more money each year and we don't get a lot back for it.
"We have got mortgages, bills to pay, and it is a lot of people's pensions. It is not all just profit.
"The cost, to an extent, will be passed on and it is not fair on the tenants.
"The margins have to remain as much as possible and they are being sliced down. There could be more done to try and prosecute bad landlords instead."
East Midlands Property Owners Group, based in Lenton, represents around 600 landlords in the city.
Giles Inman, business development manager at EMPO, said: "We are dismayed.
"Every time the cost goes up the rent goes up and I can't be more definitive than that.
"We have lots of landlords that have young professionals, young nurses, not just students in their HMOs and it is another tax on renting.
"The council have said they are doing it because they have realised they are losing money.
"Putting the fees up is making it more difficult for these tenants and it is just more hardship.
"A lot are struggling and have been made unemployed because they are in hospitality or furloughed and a lot of them are renting.
"We should all be in this together and getting through this crisis."
Nottingham City Council has defended the licence rise.
Councillor Linda Woodings, portfolio holder for planning, housing and heritage, said: "There is a proposal to increase the fees for the Additional and Mandatory Licence schemes (for Houses in Multiple Occupation HMO).
"If agreed, they would come into effect from April 1, 2021.
"The last fee rise for HMO licensing was in September 2018, and we normally review all fees yearly.
"The 2019 review indicated that an increase would be necessary and this was scheduled to happen in April 2020.
"However, in order to support landlords during the Covid-19 pandemic, we held off on these fee increases, but we cannot continue to do this indefinitely.
"The cost of the licence fee pays for the running of the service and the council is not allowed to make a profit from this.
"But this does mean that fee rises are sometimes needed to cover increased operational costs. Selective Licensing fees are unaffected by these proposed increases.
"We are proposing to continue to support accredited landlords with a £170 fee reduction from the non-accredited standard licence fee."
The fees that landlords pay per property at the moment and the fees proposed:
1.) Standard: (for non-accredited landlords and application fee up to 9 bedrooms)
Total £1,330 but set to rise to £1,450
2.) Less compliant (for non-accredited landlords and application fee up to 9 bedrooms).
Total: £1,720 but set to rise to £1,850
3.) Accredited (the proposed licence holder is accredited with the Nottingham Standard Unipol or Dash and application fee up to 9 bedrooms).
Total: £990 but set to rise to £1,280.