The Government has averted a looming crisis in the HMO sector that would have seen many tenants charged individually for council tax, rather than paying a share of the property’s annual bill.
As LandlordZONE revealed last month, MPs Penny Mordaunt and Caroline Dinenage, both of whom have constituencies featuring significant HMO densities, have been putting pressure on Ministers to reign in the Valuation Office Agency.
The government agency, at the behest of some 50+ councils around the UK but particularly in Portsmouth where Dinenage is an MP, has been reclassifying rooms within HMOs as individual homes – much to the horror of tenants and their landlords.
But relief is now at hand. In a statement to the House of Commons, Dehenna Davison, Parliamentary Under Secretary of State at DLUHC, told fellow MPs that a consultation on the problem is to be launched in January that will “look at situations where individual tenants can, in certain circumstances, be landed with their own council tax bill and will consider whether the valuation process needs to change,” she said.
“Our clear intention is for HMOs to be classed as single dwellings, other than in exceptional circumstances.”
Any changes will be part of the Government’s Levelling-Up and Regeneration Bill, but Davison told Dover MP Natalie Elphicke that adjustments to reimburse councils for the ‘lost income’ would be made via regulations rather than wait for the Bill to gain royal assent “as a matter of urgency”.
Richard Graham, MP for Gloucester, said he was glad that Ministers had listened to both MPs and those outside parliament, and that it would be “incredibly reassuring for people who are renting in HMOs”.
Landlord Daryn Brewer from the HMO Council Tax reform group that has been lobbying MPs on the issue, told LandlordZONE: “We are delighted to hear that the government is taking this issue seriously and that landlords and tenants have been listed to about the concerns of Council Tax being charged on bedrooms within HMOs.”