The why (introduction to the Landlord Licensing scheme)
There was a time – a bloody amazing time – when ONLY landlords of House of Multiple Occupation (HMOs) required a HMO license before being to let their property legally, while the rest of us were spared.
But that was back then, and this is now.
Alas, since then, some very rich and powerful people sat down with some super smart analysts and came up with the idea of introducing compulsory landlord licensing compulsory for all privately rented properties in poorer areas. The idea being, apparently, that it will not only help raise the standard of living conditions, but also help reduce… wait for it… “antisocial behavior”
Yes, so if we all rally together and purchase landlord licenses, we should see a decline in antisocial behavior.
Wait, what? Confused? Yes, me too. But that’s irrelevant unfortunately.
The issue of the ‘Selective Landlord Licensing Scheme’ isn’t particularly new, in fact, it’s been looming around like a repugnant Vegetarian’s fart since April 2006. However, it’s starting to get rolled across more and more boroughs around the nation, so naturally an increasing amount of landlords are starting to make some noise as they get a whiff.
Sadly, it’s an issue ALL landlords SHOULD be aware of because it is a legal requirement if it applies, consequently it could also account for unbudgeted costs, and have major influence over where a landlord chooses to buy in the future. I’ve already spoken to a few landlords that consciously avoid zones that are subject to the scheme- not because they have something to hide, but simply out of principle. Yes, landlords with morals, I’m not fucking with you. But that’s another story for another day.
As with most of these harebrained schemes introduced to benefit the ‘greater good’ – it comes attached with a financial cost that landlords are forced to grin and bear. In other words, the ‘bend over, this won’t hurt a bit’ treatment is in full effect. Of course, it always hurts, and there’s always plenty of anal-blood squirting all over the place.
Someone is getting richer, but it definitely isn’t the landlord.
Anyone else remember Home Information Packs (HIP’s)? Yeah, that steaming pile of shit wasn’t a bad dream either. Let’s just hope this bubble pops even quicker and the damage is limited.
I know, I’ve got a brilliant idea, let’s throw as many shitty policies up against the wall to see what sticks, and let’s ensure they cost landlords a shitload. That will be fucking hilarious.
What is the landlord licensing scheme?
Sections 79, 80 and 81 of the Housing Act 2004 provided for the introduction of a scheme of selective licensing of private landlords in a local housing authority’s area (i.e. a poor area where many tenants are receiving housing benefits). The Act came into force in April 2006.
Selective licensing is intended to address the impact of poor quality private landlords and reduce levels of antisocial behaviour. It was primarily introduced to tackle problems in areas of low housing demand in mind– although the Act also allows for selective licensing in some other circumstances.
In areas subject to selective licensing, all private landlords must obtain a licence, it is the landlord’s legal obligation. Failing to do so could result in heavy-handed penalties. I quote Gateshead council, “If the landlord of a property in a selective licensing area doesn’t have a licence, he/she commits an offence that may be punishable by a fine of up to £20,000.”
Yes, that’s a 20 grand fine!! Bosh! How do you like that?
But that’s not all, breaches of the licence can also incur extra penalties in the sum of £5,000.
Like I said, someone is getting very rich from this cashcow. Although, I’ve heard allegations of it being a ‘non-profit’ scheme. Right.
What do landlords need to do in order to get a license?
If you’re required to get a landlord license, you will need to apply for a license via your local council. Just to clarify, that’s ONE license per property, but some boroughs have been generous enough to offer bulk rates. Amazing!
If you’re unsure whether you’re subject to the scheme, again, just ask your local council or look on their website. If you’ve got the stomach for it, you could even ask your local letting agent. Whatever works.
Usually the person who is in control of the property (the person who receives the rent) makes the application and is the licence holder. This could be the owner or landlord, however it could also be a manager employed by the owner.
Once an application is submitted, it must be processed to determine whether or not you will be granted a licence. So in practise, yes, you could get rejected.
Each borough will have their own set of conditions, which the landlord must meet in order to be granted a license. Landlords are also expected to stick to certain conditions once the license is granted. There are also certain mandatory conditions which need to be addressed, which include the following:
- A valid gas safety certificate, if gas is supplied to the house
- Electrical appliances and furniture (supplied under the tenancy) must be in safe condition
- Smoke alarms must be in proper working order
- The tenant must be supplied with a written statement of the terms of occupation
- References must be demanded from persons wishing to occupy the house
The mandatory conditions all fall in the realm of ‘pretty standard stuff’. Needless to say, I shouldn’t need to buy an extortionately expensive license just to confirm I’m already doing what any half-baked landlord should already be doing. I guess it’s one of those situations where the good have to suffer because of the bad. Fair.
I’m told the cost varies depending on location/borough, but from the information I’ve gathered, you’re looking at the £500 mark for a license, which remains valid for 5 years. Again, the conditions may depend on the district your property falls under.
Here’s a list of the areas that are subject to landlord licensing, but I’m sure there are more, these are just the ones I’m currently aware of. I’ll try to keep the information updated, so if anyone has any additional information, please let me know and I’ll make the appropriate amendments.
Note: smaller areas with in boroughs may only be subject to landlord licensing, and not necessarily the entire borough!
|Blackpool, Claremont||Unknown||Blackpool Council||Yes|
|Blackpool, South Beach||Unknown||Blackpool Council||Yes|
|Blackburn, Ewood||£500||Blackburn Council||Yes|
|Blackburn, Queens Park||£500||Blackburn Council||Yes|
|Blackburn, Sudell||£500||Blackburn Council||Yes|
|Blackburn, Sunnyhurst||£500||Blackburn Council||Yes|
|Blackburn, Marshouse||£500||Blackburn Council||Yes|
|Bristol||£1000 for a 5 year licence||Bristol Council||Yes|
|Burnley||Unknown||Burnley & Dagenham Council||Yes|
|Doncaster, Hexthorpe||£500||Doncaster Council||Yes|
|Durham, Wembley area/Easington Colliery||To be agreed||Durham Council||Yes|
|Durham, Dean Bank/Ferryhill||£450||Durham Council||Yes|
|Durham, Chilton West||£450||Durham Council||Yes|
|Leeds, Cross Green||Unknown||Leeds Council||Yes|
|Leeds, East End Park||Unknown||Leeds Council||Yes|
|Liverpool||£200 – £400||Liverpool Council||Yes|
|Lincolnshire, West Lindsey||£375||West Lindsey Council||Yes|
|London, Barking & Dagenham||£500 for a 5 year licence||Barking & Dagenham Council||Yes|
|London, Brent||From £340 for a 5 year licence||Brent Council||Yes|
|London, Croydon||£750 for a 5 year licence (£350 early bird discount available)||Croydon Council||Yes||Unsuccessful challenge|
|London, Enfield||N/A||Enfield Council||Petitioned against||Successful|
|London, Newham||£500||Newham Council||Yes|
|London, Waltham Forest||£650 for a 5 year licence||Waltham Forest Council||Under debate|
|Nottingham||£600||Nottingham Council||Spring 2018|
|Middlesbrough||£580 for 5 years||Middlesbrough Council||Yes|
|Oldham||£490 for 5 years||Oldham Council||Yes|
|Peterborough||£600 for 5 years||Peterborough Council||Yes|
|Rotherham||Up to £605 for 5 years||Rotherham Council||Yes|
|Stoke-on-trent, Tunstall||Unknown||Stoke-on-trent Council||Yes|
|Thanet, Cliftonville West||Unknown||Thanet Council||Yes|
|Thanet, Margate Central Wards / Margate||Unknown||Thanet Council||Yes|
|Wirral||£625 for 5 years||Wirral Council||Yes|
|Wolverhampton||£525 for 5 years||Wolverhampton Council||Yes|
Important: I update the list as and when I can- usually after someone leaves a comment or emails me directly with an update. However, I wouldn’t rely on the list to be up-to-date. If you wish to find out accurate information regarding a particular borough, you should either look on their website, or contact them directly.
It works slightly differently in Wales from what I’m aware.
Any landlord who has a rental property in Wales which is rented on an assured, assured shorthold or regulated tenancy is required to “register”, which costs £33.50 if completed online (paper-applications cost £80.50. Ridiculous!).
If you are a self-managed landlord (e.g. arranging or conducting viewings with prospective tenants and the tenancy agreements etc), you may also need an additional “license” The licenses last 5 years, and the fee is currently £144.00 for applications completed online (applications submitted via paper application costs £186.00).
More details on both over at the Rent Smart website.
Are you outraged? Care enough to start a petition?
As you may have noticed from the table, Enfield Borough Council’s landlord licensing scheme was successfully petitioned against by a bunch of landlords. Yes, the scheme was scrapped! Phewwww, close call from being totally ass-raped.
Croydon Borough are in the process of trying to do the same.
If you care enough, you should definitely follow suit and fight the good fight. Most Boroughs will have a petition scheme available. Ask your council or look on their website or try Google’ing “[Borough name] petition”
Power to the people!
Why I think the Landlord Licensing Scheme is nonsensical!
Of course, I’ve heard many landlords applaud and praise the introduction and expansion of the scheme. But I don’t really understand why.
Actually, I think I do, it’s the marketing campaign that’s been strategically used to push this shit-storm forward to win over votes. But it’s all smoke screen and mirrors, really, it’s just bullshit marketing. There’s a lot of hype and emphasis on “improving social housing”, but I’m not convinced.
All I see right now is a couple of punks in suits, jacking me in the middle of the day. Daylight robbery.
I specifically say “NO” to the scheme because I don’t think it will directly resolve the underlying problems the scheme is packaged to address, let alone any problem at all. If anything, I believe it will have an adverse affect on the overall industry. Let me explain why…
- Cost: obviously the cost element is a concern. £500 is nothing to sneeze at, especially when I feel like I’m being mis-sold a product that is fundamentally pointless. Also, if it’s there to help landlords, tenants, and society at large, why the hell are landlords left copping the bill?
- Bad landlords: the powers that be have suggested that the license is a key tool to raise living conditions and prevent bad landlords from getting away with whatever it is they have been getting away with all these years.
Ok, so they expect the landlords that are ALREADY providing poorly conditioned properties and neglecting their obligations to suddenly pay attention to this new legislation. Really?
What’s another legislation to completely ignore for a bad landlord? Nothing.
Stacking penalties: tenants shouldn’t be mislead in order to swing the votes in favour of the scheme, but I feel like that’s the case. Sadly, this scheme is preying on “ignorance”
If a landlord genuinely participates in foul-play, there are laws already in place to enforce prosecution. This legislation won’t add any extra ‘needed’ penalties. All this is going to do is add an extra penalty on already prosecutable offenses.
- Tenants choice: tenants have the right to choose where they live. If they enter a property that looks and smells unsafe, and is smeared in congealed goat urine and gonorrhea, yet still deem it appropriate living conditions, surely that’s their choice. Do they really expect a high level of service? Aren’t they putting themselves in danger voluntarily?
These tenants genuinely don’t give a shit about where or how they live, and nothing Landlords can do will change that. They don’t see a problem in their behavior or how they treat others. Now that’s the real problem behind anti-social behavior.
- Tackling antisocial behavior: the most mystifying aspect about this scheme is that it’s meant to reduce levels of antisocial behaviour. I have no idea what statistical information was crunched in order to swing that conclusion, but I fail to fathom the correlation. Perhaps it was just a case of manipulating the numbers until it looked ‘almost justifiable’, or maybe I’m just missing the point.
I understand how it might improve living standards for tenants, but beyond that, I see no overall advantage for landlords or the community (which is what it says I does on the tin- and I don’t like paying for things I don’t particularly understand). For example, is installing smoke alarms going to stop a tenant from kicking you in the head because they think it’s funny? No.
If this scheme ‘takes off’, I wouldn’t be surprised one bit if the meaning of “antisocial behaviour” and “problem areas” becomes looser and looser. Before we know it, graffiti on the wall will trigger off code red alerts, and obviously the best way to put that fire out is with a landlord license.
Current legislation: from my experience and knowledge, I believe that most corners are covered in terms of ‘health and safety’ with the existing legislation- ultimately, that is what we’re talking about here, right? I don’t buy the whole “tackling antisocial behavior” aspect, so let’s ignore that all together. This is about raising standards, and making those accountable that fail to meet those standards.
Landlords are already required to ensure gas and electrics are safe, they are also required to ensure heating and water systems are in proper working order, and to generally provide a safe living environment. The main issues beyond those parameters are usually related to the personality disorders of the individual landlords/tenants. And unfortunately, rehabilitation and personality transplants don’t come in the form of £500 licenses. If a landlord is an arsehole, he’s an arsehole. Period.
- The slowdown: I suspect the entire process of letting a property will slowdown, meaning longer vacant periods, slower “transition” times, and an overall loss of earnings. This will affect the entire chain, not just the landlord.
- Invitation for other fees: mortgage lenders have started to refuse lending in landlord licensed zones, which makes sense, but obviously that’s a massive concern, but not only regarding borrowing, but also other services like insurance. It wouldn’t surprise me one bit if insurance policies started to climb in those flagged “problem areas” that require landlord licensing. Ouch!
The scheme may especially sound appealing to tenants, but sadly, they’re probably the ones that will end up suffering the most. As already said, this license isn’t going to protect tenants from “bad landlords”, it’s just not a sustainable or logical policy that tackles the real issues it’s advertised to address. But besides from that, consider the following…
- Many landlords are already on tight budgets, so they’ll need to get that extra money to pay for the license from somewhere. Who do you think will be the most likely person they look to when it comes to passing on the costs?
- Even those that aren’t on tight budgets, it’s just another justified excuse to raise the already crazy rental prices. Letting agents will have a field day- because I’m sure they’ll somehow swindle this cost into their ‘admin fee’
- Instead of paying £500 for a license, wouldn’t both landlord/tenant rather spend that money on improving the property and making it more comfortable? I know I would. In that sense, the license suddenly becomes extremely counter-intuitive.
Solving the actual problem
Real positive change usually comes through awareness and education.
The main problem associated with poor living conditions and acceptance of those conditions is ignorance. People don’t know any better because they’re unaware of their statutory rights and the resources they have available. But that’s a fact throughout life, in every aspect. Still to this day, I’m uncertain of what my rights are when a police officer stops me on the street. Will I go and research it when I finish writing this blog? No. Would I listen if someone made an effort to educate me? Yes.
Most tenants don’t know their rights, and even when they’re certain they’re being mistreated, they’re oblivious to what steps to take. Fear is also a major factor; many tenants are scared when they’re being mistreated. The common misconception is that landlords hold all the power, with the ability to force tenants into homelessness at the drop of a hat, which of course is completely untrue.
- Tenants know they’re entitled to hot water and a working heating system, or at least assume they are. But how many know that if the landlord doesn’t resolve the problem in reasonable time, they can report the issue to the Health and Safety Executive for further investigation, which could lead to prosecution?
- Same applies with tenancy deposits and tenancy deposit schemes– many tenants are still oblivious that their deposits are protected (or should be), so landlords can’t just unfairly snatch deposits.
- Another massive misunderstanding is that tenants often believe that their statutory rights are directly related to how much rent they are paying. Again, completely untrue. It doesn’t matter if you are paying £100pcm or £2000cpm, you are ALL entitled to your statutory rights, meaning you are entitled to live in a safe environment.
- Taking legal action against anyone sounds expensive, and that acts as a major deterrent for allowing justice to prevail. Court room, lawyers, some weird woman taking notes on a typewriter… all sounds crazy expensive, right? Really, it isn’t, nor is it that complicated to take legal action against your landlord. Need free legal advice? No problem, Shelter and Citizens Advice are at your disposal.
Since the introduction of Energy Performance Certificates in 2006, not ONE of my tenants have enquired about it or known of its existence, even though it’s my legal obligation as the landlord to purchase that bullshit and present it to them during a viewing…
All these issues point to one fundamental issue: lack of education, NOT lack of legislation.
Clearly, there are already legislations in place to protect tenants and landlords from problems that most commonly occur; they’re in place right now, at this very moment. We don’t need another wrapper (because that’s essentially all the license is) to sit on top of the existing legislations. We need more people to be aware of what already exists. The landlord license scheme is just another policy tenants will need to be educated on, so the real problem isn’t being tackled, it’s only being multiplied.
If the powers that be want to make a real positive impact, they need to cut the bullshit and tackle the underlying issues. Educating tenants and landlords of their rights and responsibilities would be much better served than throwing nonsensical and ‘expensive’ shit at the wall.
Despite my futile ramblings, it is a legal obligation, so if it applies, buy the damn license. Bitch.
I’m just about done here.
So, what are your thoughts? Have any of you been subject to the licenses? Also, once again, if anyone has any additional information on licensing zones, please let me know!
Disclaimer: I'm just a simple landlord blogger, I am not qualified to give legal or financial advice. Any advice I give is my opinion based on my experience, and is never legal or professional advice. You should always get professional advice on any legal and financial matters!