HMO quotas revisited

I’ve blogged briefly about HMO quotas before. In a nutshell: the Scottish Parliament has been wanting to introduce quotas for multiple occupancy houses/flats. Obviously, this has serious implications for certain demographic groups, namely: immigrants, students, young professionals, and generally any unrelated people who share accommodation. A year and a half ago, when this was an issue, I blogged this about it:

The Scottish Parliament ammendment to introduce Houses in Multiple Occupancy (HMO) quotas in certain areas was withdrawn. Students are rejoicing. Discussing with friend about the issue. On the one hand I dislike the anti-HMO crowd’s battlecry of “It’s social engineering!” After all, I support affirmative action, which is some degree of social engineering. But on the other hand, I don’t see how HMO quotas would have helped. Friend argues that some areas of university cities have been almost exclusively populated by largely homogeneous and transient demographic group (namely, students). This is obviously bad for poorer people, and they can no longer afford to live in these areas. Friend argues that HMO quotas would address this problem by spreading students around the cities and resulting in a more evenly distributed population in cities. Maybe I’m missing something but I can’t see how HMO quotas would address what Friend quite rightly highlights as a real problem. But the fact is that flats in “student-heavy” areas are expensive and most people can’t afford to rent one unless there in the higher economic brackets. This leads to people sharing flats. Undoubtedly it would be a good thing if HMO quotas could address the problem in the way Friend thinks they would. But I’m concerned that instead of making “student-heavy” areas more diverse, the opposite would happen. High prices would mean that only the wealthy would be able to afford flats in these areas, so instead of being student-heavy, these areas would now simply be where the wealthy people live. Ie, one largely homogenous population would be exchanged for another. And I don’t see how that would benefit poor people.

Further to this, I would now add the following thoughts, both positive and negative:

• There is no price premium on HMO flats. It’s cheaper per person to rent a large flat between several people than a small flat between a few people. This means that accommodation that is currently HMO-licensed (or for which the landlords seek HMO licenses) and which lose the HMO license will not become cheaper in ceasing to be HMO-licensed. Thus there is no reason that previously HMO-licensed accommodation should suddenly become affordable to other demographic groups (elderly people, young families, poor people, etc) who are currently in competition for accommodation with students/young professionals/etc.
• There may well be a price premium on HMO flats if quotas are introduced. This would introduce a financial penalty for precisely the people who need to share flats because they couldn’t otherwise afford their accommodation. This seems morally flawed.
• If students can no longer afford HMO accommodation, HMO flats will start being let by professionals and other more wealthy people. Thus swapping one homogeneous population for another, and not alleviating the situation for poorer people who will not be able to afford HMO accommodation either.
• Unless it’s proposed that a number of currently HMO-licensed accommodations would lose their licenses, I can’t see how the quota would be at all effective, especially in areas that are already “student heavy”.
• On a local authority level, I’m not aware of proposals for alternative proposals for increases in HMO accommodation and facilities in areas that are not currently “student heavy”. If you decrease the HMO accommodation in some areas, there has to be suitable accommodation elsewhere for other people to move into. HMO accomodation is high sought after precisely because lots of people need it due to their financial circumstances. There are two ways of getting around that that I can see: (1) provide lots of subsidised (ie low cost) non-HMO accommodation for people who currently share flats due to financial circumstances; or (2) distribute HMO accommodation more evenly (and any necessary facilities/services in line with that, such as public transport). I don’t think HMO quotas are the most effective and constructive ways of addressing the problem, because of the other reasons I’ve discussed.
• “Student heavy” areas are usually going to be areas that have the right kinds of flats for student needs — flats with a largish number of bedrooms, nearby shops and public transport, etc. There is a reason these areas are popular with students. Other areas might be less suitable for students — they might not have nearby shops, public transport, easily cyclable routes, or they might have other associated problems. HMO quotas doesn’t take this issue into account. That said, the same facilities would benefit other demographic groups (eg, elderly people, poor people, etc). Similar to the above point though, I think there are more effective ways of addressing this issues — namely providing suitable accommodation at low cost elsewhere.

Anyway, I am prepared to be convinced about HMO quotas, but I think basically I’m anti (although with reservations). For more information, you can check out the Right to Rent campaign, where you can sign a petition in opposition to HMO quotas. –IP