A scheme offering grants of up to £50,000 to HMO landlords has only been used once in the past three years, Greenwich Council has said, after parties in Thursday’s election pushed for the handouts to be scrapped or paused.
Landlords who own a house in multiple occupation and allow the council to use them as accommodation for people who are homeless or at risk of being homeless are eligible for up to £50,000 per property if they lease it to the council for three years and accept its tenants.
The current rates were approved in July last year by council leader Anthony Okereke’s cabinet as part of a push to drive down housing waiting lists. But last week Adel Khaireh, the cabinet member for children’s services, told a hustings meeting that he did not know about the HMO grants.
Details of the grants have been circulating on social media and have been raised with candidates in the run-up to the local elections.
The scheme had been blamed for a surge in HMO applications – particularly in the Plumstead area – and rival parties have pledged to pause or scrap the grants altogether.
But Greenwich Council revealed on Tuesday that take-up had been very low because of the strict conditions it had placed on the scheme.
However, a family home can be converted with a grant if planning permission for an HMO has been given, it said.
Labour, which has controlled Greenwich since 1971, faces its toughest election in more than 50 years on Thursday, against a difficult backdrop for the party both nationally and locally.
Controversy over plans to deal with HMOs
Landlords are exploiting weak controls on building HMOs across the borough of Greenwich to buy up family homes to divide into bedsits. This has caused anxiety to many residents, particularly in Plumstead, who complain about having to live alongside poorly-managed HMOs and antisocial behaviour. Most of Plumstead is covered by two council wards: Plumstead & Glyndon and Plumstead Common.
Greenwich’s current planning policy, its local plan – adopted 12 years ago – contains no restrictions on them. By contrast, neighbouring Lewisham recently introduced a new plan featuring a minimum floorspace limit of 130 square metres on the size of the home to be converted.
Now Greenwich is working on new local plan – currently at a draft stage – that would discourage HMOs in a few areas of the borough, where 2 per cent of properties have already been converted: Plumstead & Glyndon, Greenwich Peninsula, East Greenwich, Charlton Village & Riverside, and Greenwich Creekside wards.
In the rest of the borough, a 90-square metre floorspace limit is planned. This has been criticised as being too weak and left voters in Plumstead Common ward – and elsewhere – anxious about HMO landlords concentrating their attention on their streets.
Issy Cooke, a Labour councillor for Plumstead Common, has told residents she would be “pushing for” a 130-square metre floorspace minimum for new HMOs to stop homes in the ward from being converted.
HMO grants raised at hustings
The HMO issue has dominated Facebook groups for the Plumstead area, and was raised at hustings for Plumstead & Glyndon ward on April 29 by a member of the public. When Paul Billington, the meeting’s chair, quoted from the council leaflet promoting the grants, Khaireh replied: “It’s the first time I’ve seen it.”
Six days earlier, at hustings for Plumstead Common ward, the Green candidate Stewart Christie quoted from the policy, to gasps from the voters who had come along, while challenging Cooke about her record on the issue.
Cooke did not respond directly, but later posted in a Facebook group: “I want to be clear that Greenwich Council is not offering £50,000 grants to encourage the conversion of family homes into HMOs.”
What does the council say?
Grants to fix up different kinds of private housing for council tenants have been in place for many years, and are seen as a more cost-effective and practical alternative to putting people in expensive temporary accommodation such as hotels. The grants are also used to help make properties suitable so people can leave hospital beds, freeing up space in the NHS.
In 2023, the council said it was spending nearly £800,000 on using Travelodges alone – but last month it reported that it had reduced the number of families in hotels to zero for six weeks in a row, down from 200 six years previously.
But the HMO grants did not receive much attention until this election campaign.
A council spokesperson said: “We understand that houses in multiple occupation are an issue that people feel strongly about.
“This small part of our wider policy is in place to support vulnerable residents who are stuck in temporary accommodation. The scheme has only been used once in the last three years [since 2023/24], in part due to the specific circumstances that we would deem an HMO to fit the needs of a resident – who would otherwise be homeless – on our priority register.
“To be eligible for the scheme, empty properties are upgraded to a safe and legal standard and must be let to local people on the housing register at below market rents.”
Asked if an empty family home could be converted with a grant, a spokesperson said: “Not immediately, no. To qualify for the scheme, the property must have the appropriate planning permission for use as a house in multiple occupation. Grant funding is only available once that planning status is in place and where the application relates to a HMO. Owners would also need to apply for the relevant property licence.”
What do the parties say?
The Greens said: “We believe that council grants of up to £50,000 for HMO conversion must be paused and reviewed immediately in areas at risk of over-concentration. While the council’s drive to reduce temporary accommodation in the borough is much needed, this should not be at the long-term expense of smaller family homes and irreparable change to local areas.
“The real long-term solution to this is building far more suitable social housing.”
Matt Hartley, the Greenwich Conservative leader, said: “Greenwich Labour’s weak planning rules have left our communities unprotected against the surge in HMO conversions. And the fact they have been offering £50,000 grants to HMO landlords confirms that they just don’t understand how local people feel about this.
“Despite making an agreement with Conservative councillors to toughen up planning rules, the HMO proposals that Labour have brought forward in their new Local Plan do not go nearly far enough.
“We simply must protect our family homes and neighbourhoods from this permanent change, that no one voted for.
“Conservative councillors will campaign to end Labour’s HMO landlord grants, and toughen up the planning rules to make it easier for communities to oppose inappropriate HMOs in their area.”
A Greenwich Labour spokesperson said: “We have put policies in place to bring vacant properties up to an acceptable standard if they can be used to house Greenwich residents on our council housing waiting list or in need of temporary accommodation.
“Policies like this, which included bringing vacant HMOs to a standard where we can use them to house residents facing homelessness, is one part of how we have ensured that no Greenwich families are housed in hotels for temporary accommodation – and is an important tool in keeping ensuring residents facing homelessness have a safe roof over their heads.”
Reform UK said: “We would encourage our councils to use powers over HMOa to stop there being migrant HMOs or other HMO saturation in Reform council areas. This can be done via Article 4 directions to restrict permitted development rights or by using licensing powers.”
The Liberal Democrats did not respond to a request for comment.
What happens next?
Whatever happens at the election, the council will still have to draw up a new local plan, which will set out its policy on HMOs and other development issues in the borough.
A new consultation on a revised version of the plan will follow in the coming months, then an inspector will hold a series of public hearings on the plan. The council hopes to have the new local plan in place by spring next year.
Full videos of both Plumstead hustings can be seen on our dedicated hustings page. Updated at 2pm to include Reform UK comment, and again at 7pm to clarify that the three years the council referred to began in 2023/24.
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