Office to residential conversions - why the Homes Fitness for Human Habitation Act may prove an issue

As the government strives to hit its target of 300,000 new homes a year by the mid 2020’s, landlords and developers are being faced with new compliance challenges.

The government’s introduction of Permitted Development Rights (PDR) in 2016 (initially temporary, now permanent) was intended to help achieve these numbers by removing some of the barriers faced by office to residential conversions. For instance, gaining development rights was made easier, and the need for planning permission was stripped.

However, it would seem the government are struggling to reach this target, as less than half of Housing Developers claiming that they are confident of getting anywhere close to 300,000 homes a year. Although the introduction of PDRs may prove useful in the government’s attempts (by 2015, PDR accounted for more than 20% of housing starts in London and  in 2016/17, permitted development rights provided nearly 18,900 new homes), the drive for increased numbers has had a detrimental effect on the quality of homes being built.

A report in February 2019 produced by architects, Levitt Bernstein and supported by the Royal Institute of Chartered Surveyors (RICS), indicated that most homes built through PDRs fell short of even meeting the basic Housing Health and Safety Rating System (HHSRS) assessments, with many listed as having inadequate ventilation, undue noise and ‘crowding and space’ hazards (hazards associated with lack of space within a dwelling for living, sleeping and normal family/household life).

Although, what is more worrying is that it seems that some of these homes will not adhere to the recently enacted Homes Fitness for Human Habitation (FFHH) Act 2018.

The FFHH Act came into effect in March 2019, and what was unique about it is that it allowed tenants to take their landlords to court if it is deemed that their dwelling is not fit for human habitation (FFHH). The Act focuses on key areas, including; natural light, ventilation and the 29 hazards set out in the HHSRS 2005.

According to research commissioned by RICS on 568 permitted development buildings, only 30% met the national space standards. Furthermore, a report by the Labour Party found that of 111 properties in Lambeth matched to Energy Production Certificate data, 110 did not meet the minimum space standards - all 110 being 30 square metres in size or smaller.

Homes such as these that do not meet minimum space standards are potentially breaching the Homes Act, and you as a landlord could face fines of up to £30,000 if you fail to rectify these issues.

An increase in cases

Whilst most reputable solicitors will only take action in the case of genuine faults, some opportunists will see this as a quick win, as was the case with Payment Protection Insurance (PPI). These ‘claim farmers’ act as middlemen, searching for any slip ups and knocking on doors encouraging people to make compensation claims.

As tenants become increasingly aware of the changes in legislation, whether through claim farmers knocking on doors or awareness campaigns, there will generally be an increase in the number of cases taken against landlords.

So what should social landlords and housing associations do to avoid being taken to court?

Although the FFHH Act will hopefully prevent any future properties from being converted in a manner that is not fit for human purpose, it is important that landlords are now working to ensure that their current properties are compliant with the legislation.

Having an audit of your properties can help you gain an understanding as to where your properties are compliant, and what areas need improvements. An audit will look into every aspect covered by the Act, including the 29 hazards covered in HHSRS and a report will be produced to detail the results.

If, as a landlord, you feel that your tenants have made an unlawful case against you in the hope for financial gain, you should immediately seek consultancy from an expert or a solicitor.

For housing associations, it would be favourable for staff members from the bottom up to receive training in the legislation, and it would be equally advantageous for board members to have a working knowledge of the changes. This will help to make sure that your consortium stays compliant, and that potential risks can be identified and prevented before any further mistakes occur.

Pennington Choices offer consultancy, training and auditing services that can help in regards to you staying complaint. Our expertise has seen us work with housing associations across the country and our experience comes from 20 years of providing property surveying and consultancy services.