The Housing, Economy and Business Committee of Sutton Council met on Tuesday 25 November 2025. The committee approved the designation of a borough-wide additional licensing scheme for Houses in Multiple Occupation (HMOs) and approved the change of tenure for Block D at Beech Tree Place from shared ownership to affordable rent. The committee also noted and commended the council's achievement of a C1 rating from the Regulator of Social Housing for its social housing services.

Bi-annual Performance Report

The committee received the bi-annual performance report, which covers 51 performance indicators across various services including planning, revenue and benefits, regulatory services, and housing. Katrina Lloyd, Sustainability Manager, highlighted that council tax collection rates had risen due to government changes. Adam, from the development team, reported that the council had achieved 30% of its starts for council homes in London for the current year, with recent completions at Beddington Lane and upcoming ones at Beech Tree Place. The committee noted the report.

Approval of Additional Houses of Multiple Occupation (HMO) Licensing

The committee approved the designation of a borough-wide additional licensing scheme for Houses in Multiple Occupation (HMOs). Austin Lucas, Team Leader in the Residential Enforcement Team, explained that this scheme aims to regulate smaller HMOs that fall below the mandatory licensing threshold, where a recent survey identified issues with property conditions, management standards, and negative impacts on the community. The scheme is intended to enhance tenant safety, hold landlords accountable, and reduce anti-social behaviour.

During the discussion, concerns were raised about the interaction between the licensing regime and planning regulations, particularly the Article 4 directive. Fiona Means, Group Manager for Regulatory Services, clarified that while planning permission is now required for a property to become an HMO due to Article 4, the licensing scheme will regulate the standards of these HMOs once they are in place. She emphasised the importance of close collaboration between planning and licensing teams.

Questions were also raised about enforcement resources, with assurances given that the licensing fee would provide the necessary resources for inspections and enforcement. The potential for civil penalty notices of up to £40,000 was highlighted as an enforcement tool. Councillors discussed room size standards, with the council's standard being 10 square metres, compared to the statutory minimum of 6.5 square metres.

There was a lengthy discussion regarding the effectiveness of enforcement, with some councillors expressing scepticism about landlords adhering to rules and the council's capacity to enforce them. The process for dealing with non-compliant HMOs, including potential appeals to a tribunal, was detailed. The report indicated approximately 900 HMOs in the borough, with a significant number potentially requiring licensing. The committee approved the designation of the borough-wide additional HMO licensing scheme.

Regulator of Social Housing: Outcome of Inspection

The committee was informed of the outcome of the Regulator of Social Housing's recent inspection of the council's social housing services, which resulted in a C1 rating – the highest possible judgment for compliance with new housing consumer standards. Lynna Rosler, Director of Housing, stated that this places Sutton Council among a small number of local authorities nationally to achieve this standard. The inspection provided positive feedback on governance, stock condition data, and proactive work on damp and mould. Inspectors also commended the involvement of residents, including the Sutton Federation of Tenants and Residents Association and the Residents Review Group.

While celebrating this achievement, the council acknowledged its commitment to continuous improvement, with ongoing work to strengthen responses to anti-social behaviour, improve customer satisfaction, and address fire safety remedial works. Councillors congratulated the staff and Sutton Housing Partnership (SHP) on their dedication and hard work.

During the discussion, councillors praised the significant improvements made by SHP under the leadership of Mr. Tucker, transforming it from a previously unresponsive organisation to one that is more responsive to tenants and leaseholders. Concerns were raised about maintaining this standard and avoiding complacency. The process of the inspection was described as thorough, involving extensive engagement with residents. While the regulator's report acknowledged areas for improvement, the council demonstrated credible plans to address these gaps, which was a key factor in achieving the C1 rating. The committee resolved to note the contents of the report and commend the achievement of the C1 rating.

Beech Tree Place - Conversion to a Fully Rented Scheme

The committee approved the change of tenure for Block D at Beech Tree Place from shared ownership to affordable rent. Adam, Head of Regeneration, Enabling and Development, explained that this conversion is a response to the housing crisis and the need for more properties to house those in temporary accommodation. This change is expected to provide a financial saving to the general fund and improve the position of the Housing Revenue Account (HRA) over the long term. The resulting increase in the HRA capital borrowing requirement of £4.89 million will be referred to the Strategy and Resources Committee for final approval.

Councillor Lisa Webster supported the move to provide more secure accommodation for residents. Councillor David Hicks raised concerns about potential differential rental costs and how tenants would be allocated to these properties, given their higher standard, including en-suite facilities. It was explained that rents would be governed by the GLA's stipulations for London affordable rent. The allocation of properties will be handled closely with the allocations team, with a timeline of June 2026 for the homes to be ready.

Councillor Richard Choi inquired about stress testing for financial risks, such as interest rate rises, and was assured that the HRA business plan includes scenario testing. Councillor Alvarez noted that a previous attempt to convert the scheme to a fully rented scheme in 2022, which sought additional grant funding from the GLA, had been rejected. The committee was informed that while the GLA did not provide new funding for this shift, the conversion is still financially beneficial to the council. The delay in bringing the proposal back to the committee was attributed to the increasing pressure and costs associated with temporary accommodation in recent years, and the need to find suitable properties for move-ons. The committee approved the change of tenure for Block D and noted the referral of the HRA borrowing requirement to the Strategy and Resources Committee.