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Housing Act 2004
The editor of this section of the site is edited by James Driscoll, Trowers.
Introduction
This massive measure received Royal Assent on the 18 November 2004. Most of the provisions affect social housing - although there are other features to the Act. The Act includes new powers for local authorities to deal with substandard dwellings, a new requirement to licence houses in multiple occupation and a power to licence private landlords and to take over the management of private rented accommodation in certain cases. There are also changes to the right to buy and other rights of tenants in the social rented sector. As to private rentals, new provisions dealing with tenants’ deposits enforceable by preventing landlords from recovering possession from an assured shorthold tenant if the landlord fails to comply with the new requirements. New measures too for mobile home occupiers and on the owner-occupier front, the much-criticised new home information packs.
Housing Act 2004. (Explanatory notes to the Act).
Many of the provisions of the Act came into force on the 18 January 2005. The remainder of the Act will probably come into force by the end of the year – see further below in relation to the first commencement order.
There are seven parts to the Act: Part 1 - Housing conditions.
Part 2 - Licensing of houses in multiple occupation
Part 3 - Selective licensing of other residential accommodation
Part 4 - Additional control provisions in relation to residential accommodation
Part 5 - Home information packs
Part 6 - Other provisions about housing
Part 7 - Supplementary and final provisions
Dealing with housing conditions (Part I)
Local housing authorities (‘LHAs’) have for more than 80 years had powers to deal with poor quality housing. The present provisions - contained in the Housing Act 1985 – are changed by Part 1 of the 2004 Act: It replaces the existing housing fitness standard with a new Housing Health and Safety Rating (HHSR) system. This places the emphasis on the effects on occupiers rather than the building itself. LHAs will, under the HHSR system, assess the rating of hazards in the building and use this to assess what action needs to be taken. There are new enforcement powers such as improvement and prohibition notices with powers to deal also with emergencies in the case of urgent hazards. And amendments are made to the current powers on demolition orders and clearance areas to accommodate the HHRS.
Much of the practical detail will appear in Regulations coupled with Enforcement Guidance to be published by the Office of the Deputy Prime Minister both of which will appear shortly.
The Licensing of houses in multiple occupation (Part 2)
The term HMO applies to a wide range of housing types, mainly in the private rented sector, that young lower-income single people, including some particularly vulnerable and disadvantaged groups, typically occupy. Physical and management standards in HMOs are often low. LHAs have had powers over HMOs for decades. But under Part 2 of the 2004 Act the licensing of many HMOs – those over three stories or more with five or more occupants – will be mandatory. These licences will last for five years. LHAs also have wide enforcement powers and they can also apply to the Secretary of State to extend HMO licensing to other types of HMO or to specific areas. There is a new definition of what is a HMO, essentially where living accommodation if occupied by persons who do not form a single household (2004 Act, s 254). LHAs considering an application for a licence must consider not only the conditions in the building but also the suitability of the applicant.
Licensing of other residential accommodation (Part 3)
Another innovation is the introduction of a new power for LHAs to introduce selective licensing of private rented accommodation in their area. The aim is to empower LHAs to deal with specific problems in an area where there is low housing demand, the area is likely to fall into this category and for other areas suffering such problems as anti-social behaviour.
According to the government there is evidence that low house prices in areas of low demand have resulted in an influx of ”..unprofessional landlords purchasing properties to rent. These people frequently show no interest in managing their properties properly, often letting to anti-social tenants who cause a range of problems. This, in turn, can create misery for the local community and cause further destabilisation of these areas..” . And so LHAs now have a discretion to license all private landlords in a designated area in order to ensuring that a minimum standard of management is met. However, approval of the Secretary of State must be sought after local consultation and the LHA will have to show that such a selective licensing scheme will be co-ordinated with an authority's wider strategies to deal with anti-social behaviour and regeneration in the area.
Additional control provisions in relation to residential accommodation (Part 4)
There are new LHA powers to take action over properties which should be licensed under either Part 2 or Part 3 and which do not have a licence. These are the new interim and final management orders. Action can also be taken over other dwellings as well, but an order has to be obtained from the Residential Property Tribunal. LHAs will also be able to take over the management of long-term empty properties and to bring them back into occupation. There are also provisions on overcrowding in non-licensable HMOs.
Home Information Packs (Part 5)
Click here.
Other provisions about housing (Part 6)
Anti-social behaviour
The Act gives LHAs further powers to tackle anti-social behaviour in social housing following those introduced by the Anti-social Behaviour Act 2003 and which came into force in 2004. LHAs which operate introductory tenancy schemes, under which new tenants are on probation for the first 12 months of the tenancy agreement, will have a discretion to extend the probationary period. Measures too allowing landlords to refuse to agree to an exchange of tenancies, and suspending the right to buy in cases of anti-social behaviour.
The right to buy (RTB)
There are also some important changes to the Right to Buy (RTB) scheme, the statutory scheme in the Housing Act 1985 which allows secure tenants to buy their homes from their LHA at a discount. [Registered social landlords (and certain other social landlords) may also have tenants who have the RTB, or preserved RTB, usually as the result of large-scale voluntary transfers of properties from LHA ownership]. Provisions in the Act will amend the RTB scheme with a view to tackling exploitation of the present rules by property developers and tenants. To summarise the most important changes: extending for new tenants the qualifying period from 3 – 5 years
extending the discount repayment period from 3 – 5 years
suspending the RTB where the landlord intends to demolish buildings
penalising tenants who enter into agreements to resell after the RTB purchase
giving the landlord a right of first refusal if the dwelling is sold within 10 years of the RTB purchase
Miscellaneous provisions
These include new measures aimed at providing protections for mobile home users by deterring the exploiting or harassment of such home occupiers on sites (with Secretary of State power to make further changes to the implied terms of occupation agreements)
Changes have been made to bring the treatment of local authority owned gypsy and traveller sites into line with that for privately owned caravan sites with regard to protection from unlawful eviction and harassment.
The powers of the Housing Corporation and the National Assembly for Wales under the Housing Act 1996 are extended to allow them to give grants to persons other than registered social landlords for specified purposes (see the accompanying article in this issue)
Disabled facilities grant will also be available to those occupying caravans as their only or main residence.
A new duty has been introduced requiring LHAs to carry out assessments of the accommodation needs of Gypsies and Travellers residing in or travelling to their district, when they undertake a review of housing needs in the district.
A new office of Social Housing Ombudsman for Wales to investigate complaints against social landlords in Wales has been established.
A notable change which will affect private landlords is a new tenancy deposit schemes to protect tenants' deposits which are usually taken by landlords against possible damage to the premises. Many tenants complain at the problems of recovering these deposits at the end of the tenancy and the new scheme is there to provide a remedy probably through a form of mediation. Landlords who fail to join such schemes will be unable to recover possession under the mandatory two-month notice ground (in the Housing Act 1988, s 21) until they join the scheme.
Commencement order
This commencement order brought the following provisions into force on 17 February 2005:s 220 which extends the powers of the Housing Corporation to give grants to persons other than registered social landlords;
s 221 which extends the right to acquire in relation to a dwelling provided by means of a grant to a person other than a registered social landlord;
s 227 which removes the duty on local housing authorities to send annual reports to tenants. The Housing Act 2004 (Commencement No.1) (England) Order 2005 (SI 2005/326)
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