Watch: The future of HMOs: Adapting to a rapidly changing landscape

Speaker (00:04.128)

A panel of experts convened for the future of HMOs they dreamed. Darren fought council tax. Andy shared HMO hacks. With Ben and Van, change was esteemed. Let’s welcome them to the stage.

Speaker (00:24.086)

Okay, take it away with our host Andy Graham. you. I believe that this is our last talk of the day here before we can all move on and the fun will begin. First of all, it’s a real pleasure to be able to stand here in front of you all.

this afternoon and you won’t, it wouldn’t have been missed on you that I am joined by these four upstanding gentlemen here as well. three, three upstanding gentlemen. We’re gonna do something a little bit different here. We’re gonna do a Q and A, an open format Q and A. And we are gonna talk about some of the challenges that we currently face in the industry as landlords, as investors, as agency owners, and as stakeholders as well.

We’ve got a few key things to talk about and I’m pretty sure that these topics will be on the top of your tongues as well at the minute. But before we dive into anything today, can I get a quick show of hands? Who thinks that the last couple of years as an investor in this industry were more challenging than the couple of years before? Just a very quick show of hands.

Okay, great, about half and half. And who thinks that looking ahead the next couple of years could be more challenging than the couple of years we’ve just had? Just a quick show of hands. Okay, great. Well, today we’re gonna talk about some of the key topics that me and the guys on the panel with me think are incredibly important to our businesses, not just to our businesses, to our tenants, to our industry as a whole.

And we’ve got a vast array of experience here from different sectors of the market. And we’re to do our very best to discuss these, but also engage with you. We want to hear what you’re finding challenging as well. And we think that collectively as a community, we’ve got everything we need in here to solve a lot of these problems and ultimately make our businesses better and improve our industry. There’s four key things, like I said, that we would like to talk about today. And I think…

Speaker (02:34.113)

The first one, I’m gonna put Ben on the spot, I think. mean…

I can’t imagine any of us saw what happened in last couple of weeks coming. Maybe Ben did, he’ll tell us. But the Renters Reform Bill has obviously been a key thing for us all. Lots of uncertainty was going to affect a number of things that we didn’t do in the HMO space. And obviously that’s just all gone up in a big puff of smoke. Now, we’re not here to have a political debate today. And before we go any further, a couple of…

housekeeping rules if we may. It’s not a political discussion and we want to keep this as generalized as we possibly can. So while we are going to invite questions, we’re going to keep it to one question at a time from any individual. We’ll invite the questions as we go as we walk through the different topics. If we could try and keep it off.

very individual circumstances, for example, difficult tenants in your portfolio so that we can all try and get as much value as possible from the audience. We would really, really appreciate that. Of course, we are on a bit of a time limit as well, so we’ve got a lot to get through. But Ben, the renters reform bill.

Obviously it looked like a challenge for us. The NRLA, led by yourself, campaigned strongly and there were a number of amendments and we spoke not long before Rishi announced the snap election that now is the time to get it through before it might be too late.

Speaker (04:03.787)

limited by that camera over there, so I shall keep my comments headline, I think, and say that I don’t think the election is particularly helpful to be called when it has been called. We were very close to being able to get the renter’s reform bill through, and I know that there’s a lot of split opinion about the renter’s reform bill. I know full well that there’s some bits of it that don’t quite work for everybody.

But what I think we’re going to see is a very different bill in a few weeks. And I think it will be a few weeks. It came down to the final wire.

don’t think I’m breaching any confidence is when I say that Labour supported it moving forward during wash-up. So all of those amendments that were keenly fought for, which as I said don’t necessarily solve all of the problems, but they will be perceived as being a downside better when we see the bill in its new form as we will. Certainly within 100 days and maybe even quicker than that.

can we prepare for what this might look like? As landlords, as investors, I think I can speak on behalf of many of us, I think there’s definitely a degree of interpretation about just what this might look like. And I don’t think it’s going to do us any favors to, you know, try and get into a great battle with whoever might come in. I think at the end of the day, we’re going to have to work with what…

whatever that does look like, but what can we as investors and as business owners be doing, thinking about and planning for right now? Well, I don’t think the bill is going to change dramatically in terms of lots of new things being added to it. So I think we’re going to see our property portal. I think we’re going to see our ombudsman. We will see the abolition of fixed terms. We will see the abolition of Section 21.

Speaker (06:00.843)

I think what we will see is perhaps slightly longer notice periods than we have been used to. All of those things can be dealt with, but I don’t think we should sit back and just wait for them to happen. And so I would encourage you to get involved with what we’re doing, to get involved with what Coho are doing, to get involved in what your local MP is going to be doing once they get elected because…

The good thing that the tenants groups do very well is they mobilize. They go and picket agencies and make lots of noise. You guys need to do the same. We need to show that people in this room are not the enemy. They’re part of the solution.

Crappy properties are not something that we deal in. We want high standards. We look after our tenants. But it’s right that we derive a profit. And it’s right that if we hit a problem, that we’re able to deal with problem tenants, rogue tenants, dare I say it, quickly. We mustn’t let the bill turn into a renter’s, a rent dodger’s charter. We mustn’t let the bill turn into an opportunity for anti-social behavior to run rife.

I think most ordinary people, your average dude on the Clapham bus will feel the same. And that’s where we’ve got to pitch these things.

I’m going to pass it on to Val and I’m sure you’ve got some thoughts on this yourself. Yes, so thank you everyone for coming today. A big purpose of an event like this is really, there’s really great people around the country doing different things but they’ve all kind of scattered and trying to figure things out on their own. An event like today, the purpose of it is to try and bring everybody together to share the challenges to essentially as Ben says, like be in that position to mobilize when something happens. So although there’s a lot of unknowns, the one thing

Speaker (07:55.748)

that we can do is create more of a closer community that, I mean, the HMO council tax reform group was a good example where the NRLA and HMO landlords and investors worked together and, know, passing it to Darren literally got the law changed. So I think instead of everybody around the country working on their own, actually coming together is going to be really powerful. I think at the end of the day,

as landlords and investors, we have become accustomed to this idea of continual evolution of the law and taxes and things like that. And I think it will be something that we do have to continue to work with. There were a number of things that…

as a student operator that we could have done to maybe offset some of the things that looked a little bit scary, for example, you know, the lost fixed term tenancies and yes, there were some provisions put in for in the new sort of for section eight, I think it was, that would sort of give some consideration to student landlords, but there are also amendments that we can think about making to the way that we do our business. A good example in the student market would be maybe to think about bringing student tenancies forwards a little bit.

so that students aren’t in empty properties or left with empty properties over the summer period where they might be more inclined to leave. So I think it’s also being really aware and clued up on the detail in whatever this bill and all.

ultimately when it comes to fruition might look like guys because I think that there is a lot that we can do and actually I think when you really look at the detail and look at the landscape as a whole you guys are out there doing great projects you’ve got fantastic tenants the standards that you are doing it to gives you that edge in the market but I think if you really understand what’s in the bill you can actually adapt your businesses and probably find that it doesn’t have a huge or indeed detrimental impact. I Darren what do you think you’ve got a big agency managing a lot

Speaker (09:54.747)

attendance yourself, does it concern you? I don’t think anything should concern us because I think what we are very good at in this room and around the country is we’re good at adapting. We adapted to section 24, we adapted to that, we might not agree with it but we adapted, regrettably because we had to. But I think Ben’s hit the nail on the head here, I think we don’t shout loud enough as an industry.

Yeah, Ben can’t do it on his own. I mean, he nearly had the keys to number 10. And he nearly had an umbrella for that as well. But Ben can’t do it on his own. And he needs all of us to tell him and his team. And we probably need the reform group, the HMO reform group to help with that. I think.

The renters reform bill goes some way, but I don’t think it goes enough. And funny enough, I was just bending Ben’s ear out there. I’d like to see tenants on the property platform. I’d like to tenants reference themselves on there. I’d like to see them get a code. I’d like them to see their rent payments put on there. Because if it’s going to be fair and reasonable, it has to be fair and reasonable for both parties. If the government wants tenants to move out of rented to buy, then mortgage companies should be able to see how their rent payments look. And it should all be on one platform.

Yes, that’s an IT nightmare. That’s a conversation Ben and I had. But why does it have to be us as landlords all the time? Why can’t it be a two-way thing? Because we’re not landlords, we’re professional property providers. That’s what we are now. Because the government needs us. Yeah, we need tenants as much as the government needs us to house tenants. And I think jointly, we can actually make it better.

Am I disappointed the Renters Reform Building go through? Probably am, because I’m probably sitting here with Ben actually feeling like he’s worked very hard to get it where it was. Is there an opportunity? 100 % I think there is now. And I think we might see different views. You guys are going to have different MPs. And it’ll be interesting to see on the 5th of July who your MP is and what view that is and who the new housing minister is. And let’s hope we have a housing minister that actually stays longer. Yeah, for five minutes. Because currently, we’ve had more housing ministers than I’ve had HMO tenants.

Speaker (12:04.523)

So yes, I would like to see more, but I think there is an opportunity here and I think with the NRLA, with COHO, with the HMO reform group, I think we could have actually a bigger voice.

I think you get my vote for Housing Minister actually. Well I’d build it out of Lego so that would make it a lot quicker wouldn’t it. Okay good look we don’t want to lay with the point of interest reform Bill but it’s an interesting time and I think we all need to be aware. Things are potentially going to look a little bit different but appreciate the input guys. Before we move on can just…

There are a number of challenges at the minute. Just throw some out to me. As investors, as landlords, as agency owners, what sort of things are you struggling with at the minute? Just shout a few things out to us. Council tax desangregation. Council tax desangregation. Great. I’m not talking about that. If only we had somebody who knew about it. OK, well, let’s stick on it. Darren, I’m not sure how many of you are aware of the scale of this problem. I include myself in this.

I have more student tenants than do professional tenants and this wasn’t happening.

systematically and in a fair way across the country. This was happening in particular areas and it was happening to some people more than others. was a real challenge. Darren told me outside and I didn’t realize this but the scale of it and the of bills that Darren was getting was monumental and actually to have campaigned and called as many people together as they did Darren with Wendy, don’t know if Wendy’s in the room here somewhere.

Speaker (13:38.537)

tax reform group to actually change the law is staggering. think that that in itself is a huge example of what can happen when you are 1-1 or when a community puts their mind to it. But Darren, can you give us a bit of an update on the council tax integration? There are still obviously issues with maybe backdated payments and things like that. Yeah, mean, I firstly, I think everyone in this room contributed to helping change the law because however small that contribution was, all those contributions, you know, make a big

and everyone contributed to that. I think fair play to the HMO community for doing that. And this was a problem not just for landlords but also for tenants. And this is the first time, I think in a very long time, that landlords and tenants came together to actually change a law. So I think that’s a real positive there. Yes, on the 1st of December 23, it is now law that no HMO can be disaggregated and it can only be one council tax banding. So that’s a massive tick in the box. Yes, there are…

the VOA are still behind on doing it. I haven’t seen Ben for a while and he’ll laugh at this and I don’t think I’ve told Van this but I actually rung the VOA the other week about one of my pro pods still being disaggregated and the lady said to me, now Mr. Brewer before we start let me tell you how the law changed.

You may not need to tell me how the law changed. went, well, I’m sure I do need to tell you how the law changed. I said, well, you don’t need to tell me because I helped change it. And it went very quiet. And then I could hear her typing on her computer. And she went, you’re that Mr. Brewer. And then I asked her if she had a dart board in the office. So the VOAR behind, and it doesn’t hurt me to say this, they actually have a department.

you know, I’m glad they have a department because Ben will remember in 22 when I met him at the Conservative conference. Yeah, we had this conversation and I spoke to the VOA and the VOA said, you’ll never do this. You’ll never change it. And I said to well, one day we will and one day you will have a department to deal with it. So it’s quite glad when you ring the VOA and they say plus one for HMO. So I’m quite glad. I’m quite glad of that.

Speaker (15:51.965)

But in regards to disaggregation, yes, they are behind. I think now they’re talking at the end of July. Anyone that’s got backdated bills pre-December 23, unfortunately, those bills will stay. And we are still seeing tenants being chased for backdated bills. When we had all our portfolio rebanded in Portsmouth for Propods in nine months, Andy fell off his chair when I told him earlier, we had about 180,000 pounds worth of backdated bills sent to us.

Yeah, that’s how big the problem was. So to deal with that, it’s very hard to deal with that data build because you’ve got tenants saying, I’ve lived in your property, you had an all-inclusive bill, why am I now getting it? Well, you’re getting it because it’s being frustrated by a third party. That’s quite technical.

But if you’ve now got councils that are saying we’re still sending bills out because your HMO hasn’t been disaggregated since December 23, I would be saying speak to your councils because there are councils who are not sending these bills because they know if they send the bills and the tenant pays, they’re going to have to refund the tenant and then they’re going to send the landlord a new bill from December 23. So I think that part of it is all about discussing it with your local authority and getting some understanding with that. Most local authorities are doing that. The bit we have to be careful

careful on here though, is that some local authorities, and I haven’t told this Ben and you’re going to cringe when I tell you this, are still asking the VOA to re-band individually HMOs prior to December 23. So I’ve seen one that’s been backdated from now to January 21 to then go from a single band to six bands for each six rooms, to then change again from November, end of November, to then go into a single band.

That is ludicrous. I’ve raised that with the department and I’ve raised that with the MPs as well. And I think some MPs were shocked when I told them that because the idea of this law was it was to stop. Yeah. And they’re now using a mechanism of how they can do it prior to the law change. So we’re not quite there, but we’re 90 % there. And I think it comes back to what I was just saying earlier. If everyone does it,

Speaker (18:11.803)

then we can actually make a change. And don’t wait for somebody else to do it because they might be waiting for you. That’s the thing to remember.

Speaker (18:31.528)

Okay. I’m happy to have a conversation with that. So it isn’t perfect, but it’s a lot better than what it was, but there’s still things that need to be tidied up. Thank you. Okay, so throw me some more problems, questions, challenges that you’re having out there.

Speaker (19:24.463)

opportunities in terms of maybe repurposing those empty rooms. I think it’s an interesting question and I think there’s possibly a few reasons for this. So is the problem that the tenant supply that you are having has now seemed to change and that there’s sort of empty and vacant properties or spaces available?

Speaker (20:03.334)

Okay, well, I might pass this one to Van. So marketing rooms, properties and things like this, and this sounds largely like a challenge there. think understanding the tenant demographic and the sort of housing they need, but what sort of things, as the man who’s built the software that we’re all gonna rely on, what sort of things can we be doing and how can we be using these sort of marketing tools that we’ve all got to make better use of our businesses and rooms and these opportunities? Yeah, I think one of the things that

is missing in lot of HMO marketing is that it’s…

sort of for the most part, the things that exist is purely focusing on the price point. So we’ve got a whole audience, a whole customer base that have came into it purely on the low rents. I think that has then created a of a feedback loop of then HMOs are just known to be cheap. So there’s more people that will want to go cheap. But I think the reality of it is that humans are inherently social and

and it doesn’t necessarily just need to be that people are in it for it being cheap. It could also be that they’re in it because they’ve moved to a new city and that they actually, they want to meet some people around there. But that’s really hard to happen. That’s really hard to make happen where there’s no focus on who’s in the house and what the house is like. like, know, Darren has some incredible properties with pro pods.

but people probably don’t know that until they visit them. And that makes it incredibly difficult because, yeah, just the feedback looping it. So what I’d say is when I lived in an HMO, the reason I specifically picked mine was because the landlord just took a little bit of time to pretend to write the description from the perspective of the people in the house, which is actually when you’re living in a house, the people around you are actually key. And the current audience for people living in HMOs are they’ve accepted

Speaker (22:00.824)

that they’re going to live with rubbish people. They could be good people, but they’ve accepted they’re going to be rubbish. But actually, if the marketing of it and the description of it starts to focus a little bit more on the lifestyle that you’re getting it, which is how all good businesses are selling their products, it’s the lifestyle that really adds value above and beyond the hardware or whatever it is you’re selling.

I think that’s a massive thing that’s missing currently. And I think it’s also the thing that’s created the reputation it’s got because it is just lower cost housing and it doesn’t need to be. So I guess all I’d say in there is focus a little bit on that lifestyle, who’s living in there. Just to build on that point as well, think that consumer awareness is obviously a big piece and actually…

Whilst I see the challenges in our industry that we face, I think that there’s maybe an opinion of landlords in the UK. And HMO landlords tend to be pretty low down on that agenda, don’t they? But I think consumer awareness is a really big piece. It feeds back to some of these points we’ve talked about as maybe coming together as a community, really finding solutions to tackle some of these problems.

Looking at consumer awareness, looking at what we can do collectively for the HMO industry, attract people into HMOs that perhaps otherwise would have chosen something else or thought HMOs were perhaps something. What can we be doing there? How much of an issue do you think this is? You’ve got an interesting vantage point over the industry, you’ve worked with a lot of people doing a lot of management across the country. You see a lot of this sort of stuff. Yeah, I mean what a lot of people probably don’t know is…

We’ve started Coho not to build property management software, but because I lived in an HMO 15 years ago and had a really, really, really good experience. And that’s an uncommon thing to happen for a lot of people in HMOs. But I saw what it could be like and how that was created. So what I think needs to happen, like what we’re trying to do with Coho is essentially make that experience more common to everybody else. And being a tech company, you lose a load of money and we’re starting to turn that…

Speaker (24:09.879)

corner to make a load of money and we want to start putting that in towards changing the reputation because everybody here doesn’t have that kind of HMO that people in the media will talk about. If someone hears there’s an HMO popping up next door to them they panic. I even asked my mom who knows everything about what we’re doing and I lived in one, it’s great. I said if the house next door came up for planning permission what would you think? She’s like…

I’d probably write a letter, to be honest. And it’s just that perception, because although I think it’s something like…

percent of HMOs are social housing. If you ask anyone what they think it is, they’ll probably say 70 percent. And that is just that the media finds it really easy to hit landlords and really, really easy to hit HMO ones. And I think we all just need to collectively show that that’s not the case. Like events like this, like if you see some of the applications that came in, they are incredible. They put my house to shame. Like these are really like top end places. that

isn’t an interesting news article. And what we’re on a mission to do with this COHO is how do we make that an interesting discussion? How do you bring mental health into it? How do you bring environment, know, the cost of environment into it? And actually we start to see that HMOs are such an important part, not only to the housing solution, but to mental health of young people, which is currently costing the NHS loads, and to the environment, which we’re currently behind on all of our targets that is getting increasingly

to me important. Ben, on this topic of maybe consumers of awareness, maybe improving the public perception of HMOs, you’re sitting, you you’re kind of the spearhead of a lot of this stuff at the minute. What sort of advice would you share for us? Well, I mean, certainly one of the things we’ve been looking at is there’s two sort of really rotten terms. One is landlord and one is HMO. And you’ve got both.

Speaker (26:15.436)

And I think that this is symptomatic of the media that we’re kind of in at the moment. Somebody mentions Landlord, they immediately conjures images of Rackman or other unsavory characters. And obviously the truth, that couldn’t be further from the truth. So I think.

Certainly one of the things that we’re going to be doing over the summer is actually rebranding what the NRLA looks like. I’m sure I’m not meant to say that, but we won’t actually be referring to landlords in our strap line, believe it or not. And we’d be much more talking about a responsible rental sector and focusing on the experience and the benefits that the sector can bring to consumers rather than singling out a landlord. And that’s not because I’m ashamed to be a landlord.

I’m proud to be a landlord and I’m proud to be a good landlord as many of you in the room are but where the political side is moving to is and Darren referenced this well surely things must be fair the politics aren’t about fairness the politics are about or will be about ideologies

They will be about stereotypes. And we just have to be better than that. And we have to make a lot of noise, and we have to talk up what we’re doing. And we have to use regulation to our advantage. You want your property portal? That’s fine. Well, that would give me a really good benchmark to tell my tenants that the property they’re moving into is safe and that I’m a decent landlord. I don’t look at it as a landlord register. And that was one of the things that Michael Gove did listen to us on. He could have called it a landlord register. A property portal, call it what you like.

actually it’s a far more appropriate term for what’s out there. Do we want people to make an informed decision about the homes that they’re moving into? Bet your bottom dollar we do. And do we want to demonstrate that we’re not one of those shitty landlords with shitty properties? 100 % we do. And the property portal is a great way to do it. Now, I won’t get back on my soapbox, but you don’t need selective licensing in a property portal, but that’s a discussion for another day. Actually, well, it’s on today’s agenda, so we’ll come back to it. I’m sure there some questions about this.

Speaker (28:27.301)

How do we change the narrative? Any questions you guys would like to ask the panel about this? Throw them out. Hands up. Anything at all.

Speaker (28:49.464)

Darren, you take it. Yeah, because that’s NIMBYism, isn’t it? That is it right there. And again, we come back to the political hot potato of local councillors want to be seen like not in my backyard. It’s as simple as that.

I have to say, coming on to that last question and this bit here, when I set up Propods in 2017, we created Propods as a brand before we even knew what a house looked like for Propods. Because I was walking down High Street and seeing Generation Z having a cup of coffee with a brand on it.

You know, everything has to have a brand. And I have to say from our point of view, when we put stuff in for planning, our brand helps us to deter what that property looks like. So I think brandness and consumer awareness is key. But I also think it’s about how you approach the planning side. You know, there’s probably a lot of people in this room who develop an Article 4 areas, non Article 4 areas. Ben’s right, selective licensing will not

be required as far as I’m concerned once the property portal comes to tuition. But I do think it’s about how you deliver that product.

Yeah, there is not one bad landlord in this room. And I’m actually going to bet my bottom dollar isn’t because yet again, if there was one bad landlord, they won’t be in this room. Yeah, they won’t be on the property portal, you know, because that’s the reason they’re a bad landlord. So we’re not bad at all. We’re actually good. And it’s about time we start shouting at how good we are. But with planning, I think you just have to.

Speaker (30:29.943)

You have to win over that whole, well, you’re going to have druggies, you’re going to have alcoholics, you’re not. And actually, if you are, you’re actually going to do it in a good way and help out society. And if you’re not, you’re actually going to do it in a good way and help out society. So either way, you’re going to do it good and you’re to help out society. So you should feel proud about submitting a planning application because actually you’re helping to help the problem with housing at the moment. I’ll just build on that if you don’t mind,

I think this is NIMBYism and it’s not new and it will continue and I think we need to continue doing the right things but I think also being really clued up on the technicalities of planning has never been more important. There’s some really good examples around the country of particular councils making it particularly difficult for HMO investors. Almost an anti-landlord and I would say more of an anti-student policy, more so it’s driven by, but there are technicalities to planning and I think a lot of…

people, investors, perhaps more so the inexperienced when it comes to planning aren’t quite aware of just how challenging it can be. But there are people, are experts out there, the planning consultants that can really help manufacture the right sorts of applications that deal with these technicalities. And while the councils may still have issues with it, and they likely will, at least getting that foot through the door, getting that planning approved allows us to get that HMO set up, do the right thing, contribute positive

provide to the community and demonstrate good standards of accommodation. I think technically being really kind of on point with that is really quite important as well. Any other questions on while we’re on sort of planning and licensing thing guys?

Speaker (32:37.569)

anyway.

Speaker (32:42.882)

Well Darren can change the law so. Darren, I mean it is a challenge isn’t it, especially where there’s blanket policies like this. So you’re saying that the council won’t let you change from C3 to C4?

Speaker (33:00.662)

Right, but we’ll let you change from C3 to SUI Generis.

Speaker (33:06.498)

So it’s interesting, because I read something in Birmingham that they’ve actually classified HMOs as co-living. They actually have a co-living policy I was reading the other day. the first local authority I’ve seen to actually class co-living as a HMO. So it’s the same part of Birmingham that I read that thing on. I’m not quite sure if Birmingham is one or split up into two.

I’m finding though that actually I would bet my bottom dollar that if you took a derelict building in a high street and then went to a C4 you would get no objection whatsoever and that’s what we’ve done as pro pods. So we’ve ditched the C3 house and we’ve gone straight to commercial. Yeah because our aim is pro pods now is to help regenerate high streets on the South Coast and while some people might go my god high streets they’re dying there they are dying but they’re dying because no one lives in them.

Yeah? And the council’s right in a way, you are taking away a family home, I get it, but at end of the day, if you took away an empty retail unit and converted the uppers into a C4, Suey Generous, created a smaller shop for a local independent to actually start up a new business, you’ve killed two birds with one stone. And I actually think there’s a better way of actually how we grow our HMO community. Because if a high street hasn’t got facilities, then we might as well all shut up shop and go home.

Most high streets have got a bus depot, decent bus stops, taxi ranks, maybe a train station. Gosport has a ferry. I mean, I probably own it, to be honest. So I think the model is changing and I think you have to change with the times, which comes back to that planning answer. You make your first profit buying the property and getting planning and you make your second profit being a good operator. And if you take that forward, then I think you’re on to a key to success.

I’ve invested in a lot of cities where there’s been Article 4 directions, blanket Article 4 policies as well, and I think we would all agree that the rental sector has…

Speaker (35:05.441)

become more and more professionalized, very intentionally. And I think, as Darren said, I think some of these challenges are not likely to completely disappear. And I think modifying your business method and approach and strategy is definitely going to be part of the compromise that we’ve got to make. But perhaps a combination of that, along with a combination of lobbying your local MPs, trying to get that positive message through working with the experts on the planning policies, trying to actually show that these are not just HMOs as you may

thinking of experience before these are different, we’re creating a different type of environment, we’re building these communities.

Yeah, I mean, I think that sort of response is somewhat illogical because, it’s taken away a family home, but it’s also probably housing six individuals. like, HMOs are pretty much the most efficient use of that home. We have an aging baby boomer generation with a lot of people that are on the road in a five-bedroom house or, you know, a couple in a four-bed house after everyone’s moved out. Now, I’m not going to go, let’s convert them all. But the reality is, like, there was a bigger population there.

and now how do we use that space even better? But that response from the council doesn’t seem like it’s like a logical view of, well, actually we need more family homes and we need fewer of these. It’s more of a, I know that…

going to get a lot of letters if we do this we’re to get a lot of angry people and that again it just cycles back around to the reputation if they could realize that actually we have such a need for housing for not only younger people anymore it’s like the numbers are phenomenal I don’t know if any of you read Adam Lawrence’s propanomics but he did one a while back that’s like just how many houses that we’re in need of increasing each time and to me really the only answer there is better use of existing stock otherwise we just lose those

Speaker (36:56.434)

to green space which you never ever get back. Vyvan, I don’t want to jump in here, you’re an obviously HMO managing agent or operator. So one thing that we did with ProPods, we call our tenants propodians, so and they love it, right, they send us pictures on Instagram, on WhatsApp, propodians on tour, propodians having a drink, propodians having a barbecue. But one thing we did, we did a survey monkey in 2022 and we found that 80 % of our propodians travel 100 miles or more to take a new job in the city of Portsmouth.

Now, our local authority didn’t even have that figure.

Why would they have that figure? But as soon as I gave them that figure, the whole atmosphere changed in that room. Because those 80 % of propolians traveling to the city to take a job are only here for a year. They’re only here for 18 months. They don’t want a flat. They don’t want an unfurnished flat. They don’t want to gas, electric, blah, blah. If you look at our average room rate of about 750 compared to a flat that’s probably, by the time you’ve put food in, before you put food in the fridge, you’re probably 1150, we’re 35 % cheaper.

than a one bit from flat. But we’re not taking local stock.

these propodians travelling to the city are actually sharing accommodation because they want to be part of the community. And I think once that knowledge comes out and you then create those communities within your local area, I think then you might see change from local councils. But I think, again, it’s everyone doing it. to say, this is where the collective is really important because I spoke to my MP in Worcester and he had literally no idea about this side of HMOs. He saw it as

Speaker (38:34.226)
it’s all the student houses around the uni and then it’s some rundown ones on this street and when I pointed out you know I got the phone and was like look at these ones this was a rundown house someone invested like don’t know a hundred grand, a hundred and fifty grand and now there’s people with like an average average salary of sixty, seventy thousand on tenants and he’s like wow and now we meet in like a couple of weeks because he’s just interested in understanding what’s all this about. Yeah just two things one we’re doing quite a bit work with Birmingham City Council on a whole range of licensing

issues, so maybe we can connect you with our policy team. I can’t promise we can help, but we’ll have a go. But the point that Van raises is a really interesting one. Don’t assume that your elected representatives know anything about anything. And you can cut that out of the clip.

because I was in parliament two weeks or so ago talking to conservative MPs about rental reform when it was still happening. And so many of them didn’t know about that you could challenge a rent increase at the moment. With the Section 13 notice going to the first tier tribunal, they’re like, well, we think this is a good thing. Well, you’ve already got it at moment. And Van is absolutely right. You need to be the experts in your field.

Don’t be intimidated by your elected representatives. You’ve got to take them to the facts. And actually what they want, they want an easy life.

They seriously want an easy life. know, briefings and facts and figures, not piddly little surveys, but, you know, empirical evidence that is going to support your case. And actually, they want to know what’s happening locally. So, you know, I would urge you to seize the initiative and just don’t accept no as an answer. Can I just come in on that? Because Ben’s right. When we challenged the government on council tax, I remember I said once…

Speaker (40:32.105)

there are three million tenants in England living in HMOs. Someone once in the government said, we don’t believe you. And I said, well, where’s your proof? Well, we haven’t got any. And I was like, OK, well, there’s 500,000 HMOs in England registered. And if six people live in each HMO, I actually met the Housing Minister at the time. I’m no Carol Valderman, but that’s three million. Are you not?

Speaker (41:04.019)

I said, and that’s three million people. And then I kept saying it and saying it and saying it. And then when they brought out the consultation paper, they went, we believe this affects up to three million people. 12 weeks before, they told me it didn’t affect anybody. So Ben is right. And actually, you guys know more than your local counsellors. Yeah. Yeah. And you have to feel proud of saying that. You know your business inside out.

A counsellor knows a lot about a little. You know everything about.

or a little about a lot, A little about a lot. A lot about a little. I have to think then for a second. Little and large. Little and large, yeah. But yes, you guys know more than the person on the street and the local authority and it’s just about how you bring that over. You know, I have something called coffee and donuts and most people like coffees and most people like donuts. if you into a I’ve eaten more than one. There’s so many meetings.

You know more than everyone in this room, so just be proud of it and actually go and tell people in a good way what HMOs can actually do for their city. But let them take the credit for it. Yes. Seriously, let them take the credit. Let’s take some more questions. We’ve got another 15 minutes. Great question. We’ve got another 15 minutes, so…

Speaker (43:09.361)

Get to it.

Speaker (43:20.21)

have had counsellors come to Propos when we set up and I think it made a huge difference. I would like to see, maybe this won’t be a group, everyone will agree with me, I’d like to see a contact number.

on every property and a scale. You know, like when you go into an eatery and it’s one to five, no one ever go into a one, but they’re always going to a five. Why can’t you have that on a HMO? Because actually, that’s one way of raising standards, but that’s also telling the council that’s how good you are. at least right, how do you change it? I think the NRLA can help. I think having a reform group can help. Does that work alongside? Maybe, maybe not.

But it’s all come back down to that awareness. And I think, you know, we probably need a little bit more awareness nationally about what is a HMO. And actually, does anyone like the word HMO anymore? Because I can’t stand it. No, I can’t. You know, because it involves so many things. You know, but there is a need. There’s people in this room who probably have rooms that are 500 pounds. There’s people in this room who have rooms that are 1,100, 1,200 pounds. You need both. And you need a spectrum in the middle. Because you might rent a room at 500, and that person might

get a better job in 18 months time and move up to a 700. You need it all but what we do need to be is have a better understanding of what actually is it a HMO, is it shared housing, is it co-living or is it another word but what it cannot keep being is a house of multiple occupation because it just doesn’t sit right with me anymore. think something that I would like to see more of and maybe this is something Ben can take away today is

more provisions for enforcement because I think a lot of this is driven by the difficult landlords who house the difficult tenants and don’t manage the tenants difficult well and the councils are under a lot of pressure. I’ve always found as an agency owner, I sold my agency last year because there’s a lot of problems managing tenants but having a good relationship with the council, with the licensing inspectors is a really important thing and that takes time to build but I do think that they are under pressure because they simply don’t have the

Speaker (45:26.654)

provisions to enforce? No, they’re too busy faffing around processing selective licensing applications. Or not. Or not. not. Or not. Or Or not. not. not. Or Or not. Or not. Or not.

future governments and talking about enforcement and talking about bad landlords as well as really good landlords is important.

But at the same time, I don’t want to be always banging on about bad landlords because they’re very much in the minority. I want to be able to be in the position of where we have things like a property portal that reduce the impact on local authorities. Because if you’ve got a property portal that’s accessible by renters, by landlords, by the local authority, then surely, and I’m sorry to go back to it, you don’t need the double up of selective licensing. And so I do think that this is a good way of being able to

to offer really targeted enforcement to local authorities. However, I know that I’m pissing in the wind on this, quite frankly, because the Chartered Institute of Environmental Health think they need an army of environmental EHOs and that they must have a property portal and selective licensing. I had to take the woman down a peg when she said that at our APPG. I felt she needed a massive dose of realism

be honest with you, because we have no money in this country, you know, there’s not a lot of money to go round. Local authorities have been decimated by the Conservative Party for the last 14 years. It’s no wonder we’ve got such crap enforcement and it’s no wonder we’ve got bad landlords giving us all a bad name. It’s our job to talk up what we’re doing, it’s my job to convey your voices and so give me the information. And they’ve lost council tax as well. Indeed, yes, there we go. Any more questions? Throw them out. What have we got?

Speaker (47:33.574)

Well, I agree with you. I agree with you. It’s just guarantee of income.

Yep, agree. There is no firm link in my view between selective licensing and quality. It’s just somebody that’s had a quick squeeze around, ticked a box, collected your money, and buggered off again.

Speaker (48:23.888)

Well, just quickly on that. So one of the things that changed in the budget was that ring fencing of fines actually now goes back to central government rather than the local government, and particularly in terms of right to buy as well. So if you flog off a council house, that money goes back into treasury coffers. So there’s no hope in being able to rebuild that property. I think what I would say on the enforcement side is I’m not too fussed about

the idea of tenants policing the regulation because I think that there could be a I guess an incentive there to make sure that the bad landlords are held to book and you’re more likely to do it because one of the things that we found out in our FOI research a few weeks or so ago is that local authorities collect less than half of the fines for penalties that they issue. They’re very good at collecting licensing fees from good landlords but any sort

bad landlord that they enforce against, it just goes into a black hole of doom. And I think you’d have more chance of holding bad landlords to book if renters were actually to benefit. I appreciate that creates a slightly different culture, but that is one way around it. But I’ll tell you what I have seen, and obviously everyone knows I’m from Portsmouth so they can guess where I’ve seen it. We’ve actually seen letters go through doors of potential HMOs from the local authority to say to the tenant, we believe this

an illegal HMO and you could be entitled to a renter’s repayment order. I mean that’s lovely isn’t it? You know actually hand delivered down streets and so…

in

Speaker (50:09.941)

Indeed. Yeah, so you could have a landlord who accidentally may not know what’s going on and straight away you could be liable for a renter’s repayment order. Not, we’d like to discuss this with your landlord and see if we can actually bring it up to the right specification and law, you’re automatically going to get a renter’s repayment order. And that’s shocking in this day and age. But they also have that information Darren. just don’t talk to each other. But they have people going down the physically putting this through doors but yet they’ve got no staff. I’ve also heard of the PPI

up turning their attention to actually getting in touch with tenants and being like show us the contracts show us the things. I think there was the idea of

There will be an ombudsman for landlords. You’ve got to be registered with an ombudsman as an agency. I believe there’s a proposal to be an ombudsman for landlords. I have always encouraged private landlords to behave in the same way as agents. Agents have been having to do it for a while, having proper policies and procedures and a methodology to follow. If a tenant is unhappy, there’s a process that you can go through. You can refine the system. You can look at methods to improve. And if it’s unfounded, at the end of the day, there is someone who can

mediate or arbitrate that scenario. And we have found with lots and lots of tenants, some of them very difficult at times, that’s always been a great way of protecting us and sheltering us in our reputation and actually getting tenants to really back down when push comes to shove. There isn’t actually anything fundamental to actually maybe claiming back. A lot of that has been financially motivated, certainly in our experience as well.

It does take time and that is a frustration but I think having systems and processes and teams in place, know, Van is building something that’s going to help a lot of the smaller landlords. This sort of software hasn’t existed before. lot of landlords and maybe a lot of you still are managing my spreadsheets and tools like that and I think these sorts of systems and processes can help us do that and actually perform better as businesses. I’m conscious we’ve got a couple of minutes left so we do have time for a couple more questions.

Speaker (52:20.132)

Any Far right.

hello. Hello, mum.

Speaker (53:03.588)

So, slightly facetious. At the moment, we’re in, you know, pre-election mode where talk is cheap.

We don’t have housing manifestos from either party. We can make some intelligent assumptions about where their minds are at. I do think Labour will be very much in favour of prosecuting more landlords. Just by their very definition, that’s what they like to do. But that’s not official policy at the moment and we have to see how all of these things tie together.

to wait laborers as they offer the Tories at the moment. Thanks Ben. Any more questions? out there? Well, I think that is probably in that case a good indication. Thank you all for your time. Thank you for your great questions. Can we have a big round of applause for the panel?