Ill-thought-out legislation continues to criminalise the innocent
On a day where it’s been announced that the newly implemented Right to Rent legislation is not working, two landlords at opposite ends of the country have contacted the TR Group about the impact selective licensing is having on them.
Selective licensing means that private landlords are required to obtain a licence allowing them to rent properties within their area, aiming to address poor quality landlords and anti-social tenants.
Housing Minister Gavin Barwell MP is a well-known critic of local authority licensing schemes governing the PRS, but this year alone has already seen consultations popping up right across the country; Sefton (Merseyside), Hyndburn (Lancashire), Barrow (Cumbria), Nottingham and Bournemouth to name but a few.
Landlords are beginning to fight back though;
- A back bench revolt recently forced Fenland Council to abandon its plan to bring in a selective licensing scheme in Wisbech, which would have seen 2,400 rented homes brought under new controls.
- The Somerset Property Network set a precedent by stopping North Somerset Council from going ahead with their licensing plans last summer, and are now working with the local authority through the newly created landlord accreditation National Landlords Code of Excellence Ltd (NLCE UK).
Increased interest in licensing appears to be directly linked to the growth of the sector (now the second largest tenure in England), where local authorities are now realising the money they can generate through landlord licensing; even though central government prefer voluntary accreditation schemes to be implemented.
The following (live) cases will give you an insight into the unintended consequences that this legislation is creating for hard working, innocent people:
John B – North Ormesby, Middlesbrough:
‘As a landlord of 16 (well kept) buy-to-let properties in North Ormesby, I’m up in court tomorrow for failing to pay for my licence.
We received a letter in August/September 2015 about it being rolled out from January 2016, but when the deadline came around it coincided with a 13k tax bill so I couldn’t afford to pay the extra £9,280 licensing fee on top of that (£580 per property). So I called the council and explained my situation, who told me that if I didn’t pay the full amount by the 31st January that I would be fined £100 per house.
I tried to explain that I couldn’t because I didn’t have the funds available what with the 13k tax bill; that I wasn’t trying to avoid it but that I physically couldn’t afford to just pluck 9k out of the air; especially as my properties have never experienced any anti-social behaviour issues or repair orders.
When I was told that this didn’t matter, I asked if it was possible to set up a payment plan and was told in no uncertain terms that the council is not a finance company and must collect what is owed in full.
I’ve been to a solicitor but he says this is not a defence, using the analogy ‘It’s like if you’ve got a car on your drive, no money to tax it but you still need to drive it; then you’ve still got to tax it.’ But it’s not the same situation though, is it?! When you buy a car you know you have to tax it, but when I bought the properties no-one told me about selective licensing…
Middlesbrough tried this before in the TS1 area in 2008/09 I believe. And just 2 years later it was scrapped and no-one got their money back.
The Inland Revenue would be willing to set up a payment plan, but the council “cannot”…
As a local landlord and property developer, this is my main source of income. All I’m trying to do is provide for my family for a decent life.’
Jon M – Hastings:
Proactive landlords around the UK are preventing anti-social behaviour from taking place within their properties by properly referencing their applicants through the concept of Tenant Histories.
The National Landlords Code of Excellence Ltd also offers a free anti social behaviour reporting system for private renters; removing the fear of retaliation from whoever they are reporting, as well as taking the lengthy process away from local authorities. As well as a free property maintenance and repair reporting facility, to help tackle the age-old problem of maintenance/repair issues between tenants and their landlords.
These mechanisms negate the need for ineffective landlord licensing – enabling better relationships between landlords and their tenants, improving property standards and providing safer communities for all.
- Have you been affected by selective licensing?