Catching rogue landlords faster with new technology

Additional licenses provided by local councils under the new legislation for Houses of Multiple Occupancy (HMOs) will help stop rogue landlords

Local councils across the country are in the process of consulting on, trialling, or implementing additional licensing schemes for houses in multiple occupation (HMO). In the future, the majority of landlords will be required to have a licence if they rent to three or more people from two or more households.

The licensing regime has been designed to improve the condition of privately rented homes, reduce anti-social behaviour, and support landlords by providing guidance and support. The license conditions require landlords to keep their homes in good condition and ensure high standards of management, or risk enforcement from the council. Anyone found to be operating an unlicensed HMO will be committing an offence and will face enforcement action.

What are Houses in Multiple Occupation (HMO) licences?

HMO licensing was first introduced in Scotland in 2000. In order to be granted a licence under the scheme, properties must meet certain standards, such as presence of smoke detectors and fire doors. These provisions were included in response to a fatal fire at a student flat in Glasgow, which had no working smoke detectors, and metal bars preventing escape through a window. Since then councils across the UK have been implementing HMO licensing in order to protect residents and make sure properties are safe and fit for purpose.

The cost for a licence varies from authority to authority and range from £55 to £1,150 with the average first licence costing £591. It is an offence for landlords to not have a licence in place. It is also an offence for them to breach the licence, such as allowing more people to occupy a property than permitted. Failing to comply with a scheme is a criminal offence that can result in prosecution and a civil penalty of up to £30,000.

What are the difficulties faced when investigating landlords for HMO licences?

To check if a landlord is telling the truth about who is living at an address and the need for a licence, it’s important to do more than ask them and inspect the property. For example, tenants could claim to be part of the same household when they are not. The data to check this is often spread across multiple databases, such as the electoral roll, Companies House and open source data. Also, rogue landlords frequently use aliases and the details of family members to obfuscate the identity behind the licence, and to avoid criminal offences and penalty fines. Tracing unlicensed landlords can seem almost impossible—in the case of one convicted rogue landlord, the council who banned him under the housing act also paid him over £500,000 in housing benefits. Rogue landlords will never make it straightforward for councils to keep tabs on them, making verifying their information and investigating occupants extremely difficult.

What can be done to improve HMO licence investigations?

New technology is breaking the limitations of inefficient processes and manual searches for HMO licence investigators. Data visualisation and graph theory map together different databases in order to better understand who is living in a property, who owns it, and if or how they are connected. HMO licence investigators can connect the dots on suspect landlords much more quickly.

Adopting this new technology also gives HMO licence issuers and investigators the ability to assess applications faster and more effectively. For example, investigators with the ability to instantly see tenants’ previous addresses and previous co-occupants can verify family status far more accurately and more quickly than manually searching a number of databases. It also expands investigations into a rogue or unlicensed landlord with the ability to instantly see who owns a property, how much was paid, and who provides any mortgages against it.

How can new technology help uncover rogue landlords?

By combining the multiple databases that would normally have to be individually accessed and cross-referenced into one , investigators can untangle the constellation of data—and uncover revealing connections that would normally be missed.

The inclusion of easy-to-access property information from Zoopla giving a description of the property including internal pictures, and provides clues as to whether the property is being used as a HMO. Another important dataset that isn’t usually available is non-public data such as email address and mobile phone numbers, making it possible to find any links to other people who have shared those details.

One of the challenges is enforcing the HMO licencing conditions when something goes wrong. In 2017 Local authorities recorded 5,069 licensing offences, such as not having a licence in place or breaching the terms of the licence; for example, allowing more people to occupy a property than permitted. Over-occupation can be difficult to detect, as those involved will stay under the radar and not be on the electoral roll. By having access to additional non-public datasets such as sub-prime loan applications (aka payday loans) and redirection information, licencing investigators can uncover other occupants who have stayed off the electoral roll but have submitted their address information to secure a loan.

As HMO licensing expands across the country those with access to additional databases, intelligence, and the technology to exploit this data are already seeing faster licensing of legitimate landlords whilst uncovering more instances of HMO licence breaches and locating landlords who have been neglecting their duties. Traditional investigation techniques simply aren’t enough to stop rogue landlords circumvent the law.

David Pope

Marketing Director

HooYu