It would appear that Oxford City Council is still insisting on cutting off our noses to spite everybody's face. The latest threat to force the universities to reduce the number of students exercising their right to choose to "live out" might mean that new teaching space could remain un-used. This, together with the "land tax" that is also proposed, may serve to create a volatile situation in what has traditionally been a market that has been robust over recent decades; surviving down turns relatively unscathed.
There is concern expressed in some quarters that the "interference" in the free market might have significant and unforeseen consequences. Developers, who already cannot afford to build residential housing within the city limits because of a requirement to ensure 50% is designated for social housing, are now being dissuaded from building purpose built student accommodation by a proposed £140 levy per sq. meter as a condition of planning.
This would appear to be another example of a patch to fix a patch approach to local policy. The Article 4 directive, which will be determined later this month, will provide a mechanism by which the city can control the movement of property from C3 use (single family occupation) to C4 usage (House of Multiple Occupation). Whilst this appears to be a knee- jerk reaction to the “studentification” of parts of Oxford, it belies what some would perceive as a far more sinister set of possibilities. Firstly, the impact on property values; in parts of Oxford where there are high numbers of Houses of Multiple Occupation, the value of property can be related to rental yield. If legitimate landlords can no longer convert to HMO usage, they will not purchase, and vendors will find themselves in a restricted market place, especially if families really do not want to live in area of high student population. I can imagine that there will be some dissent from residents if they find that their lovely family house is now not worth as much as the shabby HMO next door? This leads on to the second unforeseen possibility, this policy, together with the additional licensing of HMOs, risks forcing the Private Rental sector into the hands of the less scrupulous landlords; it is only these who will flout the restrictions and buy family occupied units and let them as HMOs whilst paying the council tax and without formal tenancy agreements in order that they can avoid detection. There is another, as yet unexplored legal implication of this set of policies; it may well be discriminatory legislation to say that a group of young professional sharers cannot live in a property, but a family with three teenage children can. Is it imaginable that Oxford City Council would agree to restrcit the rights of the number of any other group people to live in a street? Can you imagine the outcry if they said only one house in every hundred meters of street frontage cvan be occupied by people who have retired? If there are issues around Human Rights, at a time when central government policy in relation to housing benefit eligibility for the single under 35yr old, will put additional strain on HMO spaces, and the local authority is choosing to further restrict supply, it will make interesting work for some hungry young lawyer.
No matter what the outcome of these changes, some-one will have to pay; it is perceived as dangerous by many to interfere in what has always been a free market and one thing is for sure, rent inflation is almost inevitable as a product of this set of policies. Lawyers too, may be rubbing their hands with glee.