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To ask Her Majesty’s Government whether they have plans to
support the return of residential properties, presently let
on a short-term basis, to the long-term housing rental
market, particularly in London.
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(Con)
My Lords, I beg leave to ask the Question standing in my name
on the Order Paper and remind the House of my interests as
declared in the register.
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(Con)
My Lords, the Government support the sharing economy. In
London, residential premises can now be used for temporary
sleeping accommodation without a change of use, as long as
the number of nights of use does not exceed 90 in a calendar
year. There are no plans to discourage the use of residential
properties for both longer-term and short-term letting.
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No doubt the Minister is aware of the recent press reports on
the effectiveness of the landlord licensing scheme operated
by Newham Council, which has prosecuted 1,215 bad landlords
and recovered £2.8 million in council tax. Does he not think
it is time that the Government gave all local authorities the
right to opt for similar licensing schemes to deal with
illegal and often untaxed lettings, which are damaging the
long-term housing market?
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I am grateful to my noble friend. In our recent debate on
housing the spokesman for the Opposition mentioned the scheme
in Newham and invited me to visit Newham to see it in
operation. I agree with my noble friend that selective
licensing is a useful tool, among other measures, to assist
local authorities in addressing serious problems in the
private rented sector in specific areas. The department plans
to carry out a review of selective licensing shortly, which
will apply to properties let under tenancies or licences as
people’s only or main residence in the private rented sector.
Finally, the London Borough of Newham has submitted its
proposals for a licensing scheme for all private landlords in
the borough, which the department is currently considering.
We will certainly take on board my noble friend’s
commendation in that process.
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(Lab)
My Lords, I draw the Minister’s attention to the fact that
the Question is not only about London. Will he look at the
possibility of extending the financial arrangements that now
apply to longer-term renting to short-term renting—because
otherwise so much damage will be done to rural areas and
villages?
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I am grateful to the noble Lord, who raised this issue on a
previous occasion. I will look at it. However, it is
important to remind the House that many farmers are
diversifying into tourism and the short-term letting of
accommodation that may be surplus to their requirements is a
useful source of income. It is important that rural areas
that depend on tourism have a good supply of short-term
accommodation for letting in order to support a viable
tourist industry.
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(LD)
My Lords, is the Minister aware of the research done for the
Residential Landlords Association which showed, among other
things, a 75% increase in a year in London in the number of
multi-listings on the Airbnb website, despite the company’s
announced crackdown? Does he agree that this suggests that a
growing number of landlords are switching away from long-term
letting—which, frankly, London desperately needs—because of
the greater financial incentives for short-term lettings?
What consideration are the Government giving to offering
incentives to landlords to provide more longer-term
tenancies?
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I am grateful to the noble Lord. It is not possible for
landlords in London to switch rented accommodation wholly
over to short-term letting because of the restriction that I
mentioned earlier: short-term lettings can only be for up to
90 days. Therefore, it would not be possible legally for a
landlord to let his property on a short-term basis throughout
the year. One has to get a balance. London has to compete
with other tourist destinations and tourists expect to find a
range of accommodation through organisations such as the one
the noble Lord mentioned. Many London boroughs do not have an
adequate supply of hotels, and therefore one needs a supply
of short-term letting accommodation. Also, many Londoners, in
their efforts to make ends meet, like to rent out their home
on a short-term basis when they are not using it themselves.
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(Lab)
My Lords, is not the Minister wrong in his calculations? You
can get more money out of a 90-day B&B than you can get
out of a 365-day let.
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I am not sure that I would sign up for a short-term letting
on those sorts of terms, which sound penal. Many landlords
would rather have their property occupied throughout the year
rather than for up to 90 days and then not used for the rest
of the year. The balance we have tried to get in London is to
safeguard the stock of long-term accommodation for rent for
Londoners with the freedom for Londoners, when they are not
using their home themselves, to let it out to other people
who want to rent it.
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(CB)
My Lords, does the Minister agree that the real deterrent for
landlords letting on the open market to people on lower
incomes is the policies of the Department for Work and
Pensions, which mean that, if the tenant is on universal
credit, the landlord will not get any money for six weeks and
will then not get the full market rent and therefore is
having to make a sacrifice? With those deterrents from the
welfare system, is it not likely that homelessness will rise
as private landlords increasingly will not accept anybody who
is on a low income?
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The noble Lord is right to raise the issue of universal
credit. It is one of the issues that is now being looked at
as we run up to the Budget later this month. We will also
have a debate on universal credit later this month, before
the Budget, when he can make the point again. However, in
certain circumstances the rent can be paid direct to the
landlord in order to provide the security of income that the
landlord may need.
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(Lab)
My Lords, given the depth of the housing crisis, is it not
time to review the application of planning laws and the
planning system to this and related issues, which simply make
it more difficult for people to find a permanent home?
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As I said a moment ago, outside London there is no
restriction on what home owners can do with their homes. They
can let them on a series of short-term lets. Precisely to
protect the stock in London we have a 90-day rule to prevent
the leakage of rented accommodation for Londoners wholly into
the tourism market. We will look at the issue again, if the
noble Lord insists—but, as a former MP for a London seat, I
will need some convincing that we have not got the balance
about right at the moment.
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(LD)
Can I try to convince the Minister with the statistic that
longer than 90-day lettings in London have increased by 23%?
Given this, the Government must increase the funding for
local authorities in order to enforce the rule. We may have a
90-day rule in London but there has been a vast increase in
people advertising lettings of over 90 days, and trading
standards are no good at enforcing the rule in all but one or
two London boroughs.
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It would be for planning departments rather than trading
standards to enforce the rule. The Government have recently
announced that planning authorities can increase their fees
by up to 20% precisely to give them the resources they need,
among other things, to enforce planning legislation.
