Thousands of parents who invested in student homes are
facing large bills as a result of new rules brought in
on Thursday. Laws governing privately-rented properties
have come into force. They require substantial work to
be done on properties of three or more storeys occupied
by five or more unrelated tenants.
And the rules, designed to set minimum standards for
large rental properties, which often make up the bottom
of the market, will hit parents who joined the buy-to-let
boom and snapped up homes for their children and friends
to live in while at university.
The Houses in Multiple Occupation rules mean landlords
must install health and safety measures and apply for
a licence from their local council.
Property industry experts have welcomed the moves –
which will help authorities target slum landlords –
and expect the rules to impact only slightly on the buy-to-let
industry because only a small proportion of homes are
affected.
But families who bought student properties in many of
Britain's big university cities, where in some areas the
stock of large Victorian houses was relatively cheap,
will be forced to pay thousands of pounds to install items
such as fire doors.
Parents with children in privately rented student accommodation,
on the other hand, should be reassured over basic standards,
which some landlords in popular university locations skimp
on.
Commentators suggest some industry pundits have predicted
that these new regulations will cause rents across the
UK to rocket as landlords struggle to reclaim the cost
of HMO's from their tenants and that this regulation will
only affect selected areas of the buy-to-let market.
Landlords who operate in the highly lucrative university
lettings market are likely to feel the pinch and will
naturally try to pass on the costs to their tenants -
not what most cash strapped students need.
The Government claims local authorities are best positioned
to manage the HMO implementation, but some landlords have
contacted their council only to be told they knew nothing
about the changes.
The Office of the Deputy Prime Minister has run an extensive
publicity campaign for the HMO rules introduction, with
adverts featuring homes with sections missing. But while
most landlords are aware of the changes', many have not
had exact details or the cost of licences confirmed.
Lee Tillcock, of Business Moneyfacts, said: 'While efforts
to improve rented accommodation are welcome, licence costs
of up to £1,250 and possibly substantial modernisation
expenses mean additional financial burden for investors.'
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