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Licensing - Raising Standards or Just Raising Revenue?

Local authorities exist to improve housing stock in their area; however, licensing is not the best way to improve standards across the private rented sector. Because of this, Propertymark is voicing concerns with local authorities and local representatives from up and down the country.

Was it an admirable aspiration, or is it too ambitious?

One of the biggest issues is the lack of resources available for the enforcement of such schemes to effectively ensure standards are being met. Previously a stumbling block has always been inadequate staffing levels which has meant all aims have failed, meaning compliant landlords are paying the (sometimes hefty) price, whilst rogue landlords continue to operate under the radar. 

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Therefore, Propertymark is urging the UK Government to provide more funding for local authority enforcement and ensure councils produce information about their enforcement activity.

For example, one of the largest licensing scheme proposals is in Brent, which will cover borough-wide and operate in 21 of the 22 wards, only excluding the Wembley Park ward. The PRS is huge in Brent making up 45.6 per cent of total housing stock. In total there are around 50,000 PRS properties within the scope of the scheme so to base an estimate of on one staff member visiting three properties per day, it would take over 50 years to complete checks on every property which is a completely unrealistic number to ensure were compliant.

Some local authorities are proposing hefty fees for licenses that last five years such as £652 per property and up to £1,215 per property for landlords with Houses in Multiple Occupation. For landlords who own several properties, such as a block of flats the costs can be substantial. However, councils such as Merton have acknowledged the high cost for these landlords and offer discounts for multiple licenses within one unit in their proposed scheme.  

Another concern around the local authorities’ resources is the time taken for them to process licenses and their ability to deal with the admin which is leaving many landlords frustrated and uncertain around their entitlements whilst being processed. When engaging with members, some mentioned during the Tower Hamlets consultation that it took months to receive them.

Charging forward in their aim of improving standards, some local authorities are acknowledging the difference being part of an accredited organisation makes. Landlords are much more likely to be clued up on the requirements asked of them through their own personal membership of a body or group or by using an agent who is a member of an organisation such as Propertymark.

Some local authorities are offering discounts for those that are members of a number of approved bodies including ARLA Propertymark which we believe should be taken up by more councils in order to limit the costs for good landlords.

As more and more schemes pop up, we’ve engaged with our members and responded to consultations on selective and additional licensing schemes for areas such as Brent, Manchester, Merton, Redbridge, Middlesborough and Tower Hamlets. 

We’ve previously encouraged the London Rental Standard and co-regulation models as alternatives to licensing and we will continue to engage with all levels of politics and government to ensure local authorities are targeting their scarce resources appropriately and good agents and landlords are not burdened with overzealous licensing schemes.

* Tim Thomas is Policy and Campaigns Officer at Propertymark *

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    All of mine are in Brent and over the last 6 years, not one was inspected. I put my thoughts in a Brent Council consultation, part of my response is that I use a registered Estate Agent who comply fully to all requirements to let. Brent, of course won’t take any of this onboard, all that will happen is that i’ll have to re supply all certificates ( which the agency already has) pay the fee and gain a worthless piece of paper.

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    Why not fund improving standards through fining more rogues instead of putting all the costs on good landlords ?

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    A freedom of information request in 2018 in Brent, revealed just 2 Landlords had been prosecuted and the scheme had been on operation already for 2 years.,

     
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    Because we are the low hanging fruit 🍉

     
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    Just a money rising scam by councils, the cost of which is paid for by tenants

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    My Local Authority knows who the good landlords are, they know which properties are likely to be compliant, they meet the good landlords at landlord meetings.
    Some of my properties have been licensed for 20 years, so I've now paid the license fee 4 times for the same houses. I did get a discount last time because I was accredited but it's still a very profitable exercise for the Council when dealing with long term compliant landlords.
    I have no idea how much it will cost next time as my accreditation has lapsed now the NRLA scheme has become so expensive.

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    Property mark is supposed to be a trade body, but is morphing into a government regularity body l wonder which politician is going to run it? My money is on the MP for Dover, elphick l think.

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    Why is this Article talking about lack of Resources and Funding, there is no such thing it’s tax tax & more tax, so lack of Funding for enforcement how much would they like its supposed to be a not for profit Scheme. The Mandatory license Application fee alone has gone from £598.00 which used to take 6 weeks to £1550.00 +
    how come I was able to do it with paper back then in 2006 when the Scheme started, it’s all Computerise now which is supposed to be more efficient.
    Further we use pay full fee up front £598. now allegedly we pay 30% with the Application £441.00 approx’ then wait a year for them to respond and process the license & pay the balance £1100. + it’s more like we are paying them twice. All this money should have been used to improve the property instead of been wasted on computer exercises.
    ARLA on about resources for enforcement so far LL’s have funded enforcement themselves with big fines and repayment Orders, maybe ARLA would like to chip-in seen as you are living off landlords as well.
    How could the Council’s be funded for inspections if they are so inefficient it costs £1550.to look at a computer Application Screen & send out a few unnecessary letters, (one to your wife, your Bank, your Solicitors your Mortgage lender and maybe the 🐈‍⬛) its like we are being stitch you up.

    FedUp Landlordy

    Legalised theft!

    Yet another bogus way to add to the coffers.

    A real shame the average tenant is clueless to how this actually reflects on rent, then likes of those sh!theads at shelter or gen rent et al. would then target councils that burden tenants whilst robbing them thro the back door via the PRS, utterly disgraceful & brought in under a sham excuse & lie.

     
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    After reading the article and some of the comments, especially from Nick… I am not convinced paying day one makes any sense, it could be worth a punt to just keep quiet and see if anyone comes knocking, it appears they make enough from landlords coughing up without spending any effort chasing those who don’t. If they contact you, plead ignorance and pay.

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    My Estate Agency was contacted by Brent to release all names of Landlirds and then they were sent individual licencing letters on all properties they managed. Threatened with huge fines for non disclosure and ignoring.

     
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    Surely Nick that would come under data protection laws ?

     
  •  G romit

    ".....ensure councils produce information about their enforcement activity."

    My LA is doing inspections but insisting on silly issues just so they can justify their scheme. E.g. in a student let having to have at least 2 double mains sockets at the desk because " students have lots of devices". Having adapters or distribution blocks is no longer acceptable for those that need them now.

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    Licensing schemes lead to increased revenue, increased costs and increased rents. They achieve nothing in raising standards.

    Councils are obsessed with rules and enforcement because it means more money for them and they can pretend to be trying to help. In reality, the best way to raise the standards is to increase supply. Make the market conditions more appealing, and more investors will come back to BTL. This leads to better standards, and cheaper rents as landlords start competing for renters to reduce voids.

    So in short, the more councils are involved, the worse things will get for everyone, in every measurable way.

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    We all know that it is 'competition' which really drives up standards. Local authority staff choose to ignore the 'competition effect' as thier jobs depend on inventing and re-inventing 'policy' and 'regulations' and devising biased and manipulated 'consultations' that 'justify them. Ofcourse its a money raising ruse that simply perpetuates their bureaucracy and provides almost nothing of benefit to either tenants or landlords.

     
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    Steve
    Modern politicians have not heard of market forces.

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    Modern politicians are interested in themselves, not anything or anyone else, pure and simple

     
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    I wonder how long it will be before owners of private property will need a licence to live in their own homes.

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