A major Select Committee of MPs has launched an enquiry into so-called exempt rental sector accommodation – a niche sector that is exempt from many of the regulations surrounding the rest of the lettings industry. 

The probe is by the Levelling Up, Housing and Communities Committee.

Exempt accommodation is used to house a range of people with support needs, such as homeless people, those who have been at risk of domestic abuse, prison leavers, and those recovering from alcohol and drug addiction.

Exempt accommodation can be provided by housing associations, charities, or community interest companies. Providers can also rent homes from managing agents who run the service on their behalf. 

Costs of the accommodation are met through Housing Benefit, with local authorities recovering some or all of the costs from the Department for Work and Pensions.

The Committee’s inquiry follows reports, including from the West Midlands, of unscrupulous landlords failing to provide the support and care that vulnerable tenants need, or to maintain the properties to a decent standard.

Clive Betts, Chair of the Levelling Up, Housing and Communities Committee, says: “When provided at a decent standard and with proper support, exempt accommodation can be a lifeline for extremely vulnerable people and a vital piece of the social housing landscape. But, in the hands of neglectful landlords, pocketing taxpayer money to provide this housing, this accommodation can fall woefully short of the support that’s needed.

“It has also been especially concerning to hear about this problem from political leaders in the West Midlands, and from reports in the local and national media.

“In this inquiry we will aim to find out how exempt accommodation should best be provided and regulated, and how regulation should be enforced. We will also examine why there may be regional disparities in the quality of exempt accommodation.”

As of May this year there were 153,701 households in exempt accommodation in England, an increase of 61.5 per cent since 2016.

The Regulator of Social Housing has issued non-compliant regulatory judgements or notices against thirteen providers. By July 2021 this had included issuing a non-compliant rating against three of the seven largest exempt accommodation providers in Birmingham, with three more providers subject to further review by the Regulator.

The Levelling Up, Housing and Communities Committee’s call for evidence is issued ahead of a series of public evidence hearings which will begin in early 2022.