The decision by Newham Council to license all private landlords could have wider implications and damage the UK private rental sector.
Other local authorities in the capital could be looking to adopt similar initiatives, says London lettings agency Edmund Cude, the rapidly expanding firm which has just acquired Bushells.
The Newham scheme, which will cover 35,000 private tenancies in the borough, means that all local landlords will have to sign up or be fined up to £20,000.
Robert Nichols, director of Edmund Cude, said: “Let’s be clear – there are bad landlords across the capital, but they are a tiny proportion. Attempting to inspect 35,000 properties is a huge financial undertaking and Newham Council has bitten off more than it can chew.
“At this stage, our concern is that other councils – both in London and further afield – will look to embark on similar initiatives before the negative fallout of Newham’s licensing regulation becomes apparent.
“The initiative itself is deeply flawed. By imposing this ill-conceived regulation, Newham could lead to some landlords leaving the borough altogether, thus reducing available housing stock.
“All this comes at a time when the private rental sector plays an invaluable role in reducing the national housing deficit, and this extra level of bureaucracy will simply put off potential landlords.”
* In Wales, there will also be country-wide mandatory regulation of letting agents and private landlords.
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