Portsmouth sees ‘significant’ increase in number of homeowners cutting back on HMOs, real estate experts say
Residents across the city have repeatedly grappled with the form of housing, which can see three to seven people and more from different households sharing a house.
Recent high-profile HMO requests on Plains Avenue and Tywford Avenue have seen hundreds of objections sent to council, as well as petitions from residents concerned about the changing nature of their neighborhood.
But now, real estate experts are reporting a “significant trend” that an increasing number of homeowners are selling their HMO properties or renting them out for family purposes.
The number of homeowners modifying their HMO properties has increased by nearly 50% in the past 12 months, according to Martin Silman, president of the Portsmouth and District Private Landlord Association.
He said: âWe are in the middle of a downtrend – we are seeing 30-40% more people than normal leaving the market.
âWith the capital gains tax, with the stamp duty (freeze), with Covid-19 and Brexit, there is a cohort (of owners) who would have sold in a few years, but they have now advanced it .
âAdd it all together and it makes a significant trend. “
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The council estimates that there are 4,471 multi-occupancy homes (HMOs) with three or more occupants, which represents five percent of the city’s properties.
Rental agent Daryn Brewer said he regularly sees four- and five-bed HMO properties hit the market – and believes Covid-19 has left landlords fearful for the future.
He said: âWhere I watch Rightmove every day, you see four or five bed HMO properties in Southsea coming to market.
âThere have been a lot of homeowners who have been injured due to Covid because they haven’t had students on their property for a year.
âI know a lot of owners have reallocated their properties and rented them out to families.
“It makes me think that owners are leaving the market because they are concerned about its future.”
About a third of all HMOs in the city were occupied by students, which represents 1.7 percent of households in Portsmouth.
There are more landlords in Portsmouth wishing to rent to students than there are students available to rent private accommodation in the city, according to a spokesperson for the University of Portsmouth.
He said: “The impact of students on the city’s housing stock is relatively minor and in fact there is an oversupply of private rental accommodation in Portsmouth.
âThe university has ambitious goals for the future and is always looking for opportunities to enable more people to access our high quality, gold rated education.
“The Covid-19 pandemic has accelerated the development of e-learning and this is one of the areas where we aim to develop further in the future.”
Across the rental market as a whole, a recent analysis by national real estate agents Ascend Properties revealed that the city remains in high demand.
Portsmouth turned out to be in the top seven cities in terms of rental demand across England, with almost a quarter of residents living in the private rental sector.
According to Martin, there are over 20,000 private rental properties across the city, but the problem facing the market is the lack of housing stock in the market.
He said it was this lack of housing – not HMOs – that restricted options for young families looking to rent.
The owner added, âI have heard this argument many times. I have heard that it emanates from quite left-wing organizations, choosing “good families, bad students fighting”.
“It works for groups who think HMOs are bad – I don’t mean to disrespect the board, but there are a few who are against HMOs because the issue gets them re-elected.”
âI would say 30% or 40% of our members are student owners. It has remained fairly static. The housing stock has not changed radically.
“We have to be a mixed community and unfortunately our housing stock is what it is
Using Milton as an example, Martin said there are around 3,000 three-bed houses with a single elderly occupant.
Daryn agreed, âThere’s a 100% shortage all over town.
‘It’s very rare that we have a property for 72 hours on the market.
âThere is a massive shortage of rentals, there is no doubt that rentals are increasing. But real estate prices are so high that there is no incentive to buy a property. I don’t see a lot of new owners coming into the market.
Portsmouth City Council hopes to increase the number of homes across the city with several large projects – but it faces an “impossible” central government target of more than 850 new constructions per year, according to Councilor Hugh Mason, a member of the cabinet for city planning and development policy.
He said: âWe are encouraging construction at Tipner West. We also buy back some properties sold under the Right to Purchase
“We recognize the problem, but we are doing what we can to solve the problem.”
A message from the editor, Mark Waldron