Three's an expensive crowd

New Scottish rules for renting out shared homes are worrying English letting agents. With tougher laws also being proposed south of the border, there are fears young sharers will be hardest hit

Sharing a bedroom, fighting for the bathroom and clearing up the kitchen after your friends is often the price to be paid for a place in town. Few of the generations of city flat-sharers would regard their chaotic, quasi-family life as the same as living in the more anonymous surroundings of a bedsit, yet the law might well come to regard them as identical.

Sharing a bedroom, fighting for the bathroom and clearing up the kitchen after your friends is often the price to be paid for a place in town. Few of the generations of city flat-sharers would regard their chaotic, quasi-family life as the same as living in the more anonymous surroundings of a bedsit, yet the law might well come to regard them as identical.

The definition of a house in multiple occupation, or HMO, is not the same in all parts of the country, with different councils giving different interpretations. Unscrupulous landlords who provide dangerous, cramped bedsits to vulnerable tenants are the obvious target of any new law, yet legislation that has come into force in Scotland this month is worrying letting agents south of the border. Many of the new breed of landlord drawn in by buy-to-let schemes would be affected.

All Scottish properties deemed to be an HMO should now be licensed, and by 2003 that will apply to three or more unrelated tenants. A licence is expected to cost anything from £400 to £1,700. Money must also be spent on complying with requirements such as emergency lighting and telephones, and according to the Association of Residential Letting Agents (ARLA), stipulated siting of washbasins, lavatories and "activity spaces". Failure to comply can result in a heavy fine or even imprisonment.

In Scotland, some local authorities already classify all shared homes as HMOs, which has set the alarm bells ringing in England where the Government is also proposing new, tougher legislation.

Frances Burkinshaw, chairman of ARLA, is pressing for a definition of property that should be excluded from both existing and future regulations. Where the occupants are jointly and severally responsible for the payment of rent and the protection and care of the property, they should be regarded as a family, she argues. "This will rescue the landlords of these shared, single-unit properties from having to make an absurd choice, either to stop letting to sharers or go down the most astonishingly bureaucratic route."

Peterborough city council has decreed that any property within its area housing two or more unconnected people must be registered as an HMO. The fee will be £50 per habitable room, excluding bathroom and kitchen. In practical terms it means that the landlord of a three-bedroom family semi, let to three sharers, will have to be registered at a cost of £250 which covers inspection.

A local ARLA agent recently walked out of a meeting with environmental health, planning and the fire brigade because "they could not agree what was needed."

So what lessons can be learned from the Scottish model? Ian Potter, a lettings agent in Glasgow and a member of ARLA's national council, endorses the need to improve standards in bedsits and houses where there are large groups of tenants, but feels politicians have waded in without considering the implications. He sees properties being drawn into the HMO net, either by over-cautious authorities or because the definition is not clear. "This has caused an underground market of mostly less safe properties," he says. "As landlords decide to stop that kind of letting it is causing frustration among people wanting to share." The strong sales market in Scotland is a further encouragement for landlords to sell larger properties to families.

The legislation also affects the non-professional landlord. Most people taking a job abroad, say, will let out their home, and if it is in a city the chances are the tenants will be young sharers. But because of the time it could take to re-classify a property, the choice for at least the first six months is between letting to just two people or a family.

Alex Simlett, a buyer for a department store, shares a flat with two others in the West End of Glasgow, an area popular with professionals. They are the first tenants in a newly-refurbished, spacious apartment with three bedrooms, a large kitchen and bathroom. Were his flat to be let to more than two unrelated tenants today, it would require an HMO licence.

"We pay £850 a month, which is about average for a good place here. A new two-bedroom house would cost about the same. We could not afford to live in this part of Glasgow if only two of us were paying the rent. Before we moved here, four of us were sharing a flat in an old building in a cheaper area. It wasn't absolutely dreadful, but we were constantly hassled by drug addicts and one of my flatmates felt unsafe walking home from work."

They decided that if they cut back on their spending they could afford to move into a better area. "But if a landlord were to pass on any expenses to us, or if rents should increase, we would have to think again.''

In Edinburgh, Morison Bishop, letting agents, says most student flats are three or more and there is evidence that landlords will be put off. "The registration form is daunting," said a spokesman. But there are those who see large numbers of rented properties who do not see the regulations as an unwarranted burden on landlords.

John Brown, residential sales director of DTZ Debenham Tie Leung in Scotland, says safety standards must be improved and landlords ought to be prepared to pay the cost. "Too many imagine that it is an easy life. The costs are not huge and should last a number of years. It is a fact that groups of students or young tenants can behave irresponsibly. I was shocked recently by the state of some flats, where surfaces were thick in candle wax. Students like to create atmosphere and will drink too much. Sadly, accidents can happen. By putting in safety devices lives will be saved."

He said in a recent incident a student died and the landlord was prosecuted. "A licence should be regarded as a property MoT. Tenants should expect to see all a landlord's certification, who in turn should get a better rent. I see this as a bit like seat-belts - an oddity at first and then the norm."