Liverpool City Council has been forced into a controversial move to rent houses in multiple occupation (HMOs) from private landlords after temporary housing costs spiralled from £250,000 in 2019 to a projected £28.4m by the end of the current financial year – a more than 11,000% increase.

The council’s cabinet member for housing, Hetty Wood (pictured) claims it could save up to £30,000 per family by moving people out of their hotel and B&B accommodation, but the new initiative may not be welcomed by local estate agents, as it could take properties off their books.

Uneasy relationship

The council has not always had an easy relationship with HMOs, and the initiative represents something of a policy U-turn. Over the past decade, Liverpool has seen substantial HMO growth, and the Council feared it had reached a ‘tipping point’ that was threatening family housing supply.

As a result, it has taken an uncompromising approach to the sector. In 2024 alone, it brought 33 successful prosecutions to court with fines totalling £342,584. This included one case involving four interlinked companies that were illegally renting out unlicensed HMO properties, which were together fined £259,696. There were also 11 Civil Penalty Notices, which resulted in another £59,862.

Council U-turn

However, Liverpool’s housing crisis has now reached such unprecedented levels that the council has been forced to reassess its approach. In its area, there are currently 1,635 households in temporary accommodation, with two-thirds housed in B&Bs or hotels, and since April, it has been paying £90,000 per night for 1,100 spaces.

Unprecedented levels of demand”

Officials are also citing “unprecedented levels of demand” for accommodation that is being driven by rising no-fault evictions and rent increases across the city, and rough sleeping has increased from 22 people per night in 2023 to 30 in 2024.

Through its new strategy, the council says it will provide homes with minimum one-year tenancies across Liverpool, but will be procuring services rather than holding direct leases and will not work with any landlords who have used Section 21 notices to evict tenants.