Landlord Licensing Schemes – Raising Standards or Raising Funds?

by Mark Alexander

9:41 AM, 9th August 2013
About 5 years ago

Landlord Licensing Schemes – Raising Standards or Raising Funds?

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Landlord Licensing Schemes – Raising Standards or Raising Funds?

WARNING – this article might make you want to cry, it might make you want to laugh and it will probably make you angry, and for many different reasons depending on who you are. Licensing - Raising Standards or Raising Funds?

This is one of those articles which I would like to be read by every landlord, every letting agent, every tenant and especially every Politician.

I would also like every person who reads this article to leave a comment, share it and help turn it into a HUGE debate.

So what is it all about?

My friend Mary Latham recently wrote a book about the storm she see’s brewing which is heading towards the Private Rented Sector with potentially catastrophic consequences. One of the chapters in Mary’s book is called “Raising Standards or Raising funds”.

There have been many discussions about the effectiveness of licensing which is being introduced into the PRS in it’s various forms and on many occasions, landlords have concluded that licencing has very little to do with raising standards and more to do with Local Authorities raising funds to create “jobs for the boys”

Well you may be pleased to hear that the DCLG have asked Local Authorities to complete a survey about licencing. Have they read Mary’s book one wonders?

When I heard about the survey, intrigue and curiosity got the better of me – what questions were the DCLG asking?

To my surprise,  I managed to get hold of a link to the survey questionnaire, DCLG had used ‘open source’ software for their survey. Being the curious type I obviously felt compelled to take a look, fully expecting to be met with a security screen where I would have to enter a User Name and Password to get any further. I’d have given up at that point as there’s no way I would attempt to hack a Government website. To my surprise though, there was no security! They were using Survey Monkey and that awoke the little monkey in me.

To see the questions being asked I needed to complete the page I was looking at to get to the next set of questions, so I began to fill it in. This is the point at which my curiosity transformed into mischief as I was having a lot of fun with my answers 😉

Here was my opportunity to tell the DCLG what I really think about landlord licencing in the most cynical and mischievous way possible. What an opportunity!

Now before you think about attacking me with some “holier than though” type comments, please remember the DCLG are responsible for the drafting of all of the legislation which has caused the PRS so much grief. Anyhow, enough said on that, it’s done now.

I took screen shots of every page I completed and I have put them together in a slideshow below.

Do take a look and whether you laugh or cry and for whatever reason you get angry, please post a comment or join in the discussion below this article 😉

If I mysteriously disappear, you might just find me at the Tower of London LOL

I hope you will appreciate the irony of my answers!

[thethe-image-slider name=”Raising Funds or Raising Standards”]

Note for tenants – More licensing = higher rents!



Comments

Mary Latham

10:35 AM, 9th August 2013
About 5 years ago

Hahahahahahahaha I would really like to see how that fits into their analysis of the results. If I worked for an authority where Selective or Additional licensing was in place I would cringe reading Marks replies because they are sooooooooooooooooo close to the truth.

On a more serious note I see the use of these powers in some areas as ignoring the fact that Government decided not to licence every landlord in the country and local authorities stamping their feet and doing it anyway. I admit that some local authorities are using these powers appropriately to clean up areas where properties are appalling and landlords are worse, they tend to attract the worse tenants and the whole area goes down because of serious anti social behaviour and crime. When the powers are used in such an area they can be effective because the landlords have to invest in their properties to bring them up to standard and then they are more careful about the tenants that they take because they don't want their properties trashed. What licensing will not do is change the behaviour of tenants and in some areas local authorities and the Police are simply passing on their statutory duties to landlords and this is just not on. In other areas local authorities are using a sledgehammer because they are so bad at tracing the owners of properties and they want the good landlord to pay a licence fee to give them the funds and staff to do it. This is particularly true where local authorities have ignored the word "selective" and have used this power to licence the whole of their area. Government are right to ask what they expected to achieve and more so to ask have they actually achieved their goal. Most of them will not be able to answer question one and therefore question two will be irrelevant. Just why it has take Government so long to ask these questions I have no idea.

Landlords and landlords organisations now have a very simple way to prevent the spread of inappropriate use of this legislation - during consultation we should just ask the questions asked in this survey. Thank you Mark for taking the trouble to tell us what those questions are - very helpful

Follow me on Twitter@landlordtweets

My book, where I warn about the storm clouds that are gathering for landlords is here >>> http://www.amazon.co.uk/dp/1484855337

Sharon Crossland

12:25 PM, 9th August 2013
About 5 years ago

As the resident manager for a block of private self-contained flats in Leyton East London (22 flats) surely landlords can't have it both ways? On the one hand they don't want 'across the board' licencing (even as per the Rugg Review although they were broadly in favour of it at the time) as they cite that local authorites have plenty of powers they can use, particularly when it cones to anti-social behaviour and then on the other hand complain when they use them!

We don't have selective licencing in my borough (that of Waltham Forest) and any one can purport to be a landlord. (and does). continually have to bring in Environmental Health on behalf of tenants by requesting an HHSRS inspection under the Housing Act 2004 due to the appalling conditions they (and their agents) allow their tenants to live in.

I have one tenant who is virtually blind and needs a carer, who has been forced to continue living in a flat that has sustained serious water damage with the landlord continuing to extend the dates as to when the repair work will start. I am working with another council on this particular issue as it wasn't my local authority who placed the tenant here.

I have another living in appalling conditions who has serious health issues which include a recent heart attack and I have got Environmental Health to attend there, again under the aforementioned legislation.

I have a Prohibition Order on yet another flat issued by the council, again initially under the same legislation.

The point I am making here is that I started off in leasehold support, working for the Directors of the company that own the freehold but over time I have moved into dealing with issues within the PRS due to the number of flats being sublet.

I am pleased that councils assist me in dealing with such issues because had landlord licencing been the norm then such individuals would never have gotten a licence to operate. In fact the landlord with the flat that has a Prohibition Order was fined by Newham Council for running an HMO in disrepair. Because we don't have licencing here, he was able to own a self-contained flat in my block and run it to the same appalling standards with impunity until we took over management and ownership.

Working across two sets of legislation as I do, there are great weaknesses in both but landlord licencing as per the Rugg Review would be a good start in establishing more solid and less fragmented sectors.

The type of situations I deal with here can be found in the worst types of HMO but we are not an HMO. And don't get me started on the number of assaults myself and my partner have sustained in the course of protecting our assets!

Licencing? Bring it on I say!

Mary Latham

14:12 PM, 9th August 2013
About 5 years ago

Reply to the comment left by "Sharon Crossland" at "09/08/2013 - 12:25":

The Rugg Review recommended national registration not licensing. The point is that local authorities have many powers to deal with the sort of issues that you have raised and they do not need licensing to do it. The fact is that they are not using their existing powers and there is no evidence at all that licensing landlords has made any difference to property/management standards and this is obviously what DCLG have picked up on. I know many local authorities who are almost a year behind with the issuing of mandatory HMO licenses and have have not even inspected those which have been licensed for 5 years which is part of their statutory duty. If they cannot deal with mandatory licensing how will they deal with the increased demand of more licensed properties?

Like you I want those criminal landlords out of the business but licensing will not do that enforcement of HHSRS would.

Follow me on Twitter@landlordtweets

My book, where I warn about the storm clouds that are gathering for landlords is here >>> http://www.amazon.co.uk/dp/1484855337

Mark Alexander

14:20 PM, 9th August 2013
About 5 years ago

Reply to the comment left by "Mary Latham" at "09/08/2013 - 14:12":

Here, here Mary!

Many people think what Newham have done is new.

It is NOT.

Manchester tried it, ran the project for 5 years and then dumped it. They raised £700k, spent £1million and achieved nothing apart from creating creating five jobs jobs but that's about it. Standards did NOT improve and whilst it was difficult to get to the bottom of the spin regarding, my personal view is that the intensity of pressure for them to demonstrate they had actually achieved anything was overwhelming.

Newham will go the same way, as will all of these schemes, becuase the real criminals will just ignore them.

QUESTION FOR SHARON - the Newham landlord you have cited, does he still operate in Newham and if so has he improved his standards?
.

Ben Reeve-Lewis

14:48 PM, 9th August 2013
About 5 years ago

Provocative stuff Mark.

Here’s my view as one of those council enforcement officers, tempered also by working in one of the more run down inner city areas in the country who sees the worst end of it all on every front. My area is very similar in most respects to Newham.

Admittedly my kind of borough is very, very different from places like Worcester or Torquay but I think you are making the problem out to be far more black and white than it is (and yes I know it’s you being playful)

I think all here agree that the bad landlords need to be taken out of the game and the rough, dangerous properties need to be dealt with and it’s the councils who by and large are in the frontline of this. We have the various powers, the police generally don’t.

The main problems in the PRS in my area are:-
• The sheer amount of landlords and tenants out there.
• An explosion in the number of dodgy letting agents perpetrating fraud and bypassing any laws.
• Landlords converting properties without planning permission into HMOs with tiny accommodation units that are often death-traps.
• People trafficking tied to certain landlords and properties.
• Rental properties being used by criminal gangs to grow Marijuana (EDF shut down around 10 every week in our area alone…this is just the ones we find out about)
• A high proportion of tenants with English as a second language and often with no legal entitlement to public assistance.
• A high proportion of tenants with drink, drugs and mental health problems.

All of the above make up my average working day and I think any P118 reader would agree that these are serious social problems and that their effect on the wider community costs us a fortune.

The worst landlords and agents are taking advantage of the most vulnerable tenants and the worst tenants are ripping off landlords deliberately. Somehow they have a way of finding each other, usually through cards in newsagent’s windows. I always say to them, ‘Look at the handwriting….doesnt that tell you something?’ ha ha

The problems in tackling all this for councils like mine are the following:-
• Staff cuts denuding teams to the bone so much that there is often only 1 or 2 officers in a enforcement unit to deal with the above.
• The sheer unwieldiness of standard criminal legislation.
• Lack of support by the criminal courts who impose paltry penalties which are no deterrent.
• An unbelievably long winded bureaucratic process for tackling bad landlords and dangerous properties.
• Tenants who would be the main witnesses in any council action who are themselves often severely lacking in credibility.

But by far and away the biggest problem is staff levels when faced with the volume of problems.

Newham took on a whole army of extras to do what they did. The big question for us council bods is ‘How long can they keep it up?’. If they cut staff the whole edifice will crumble.

Greenwich council are about to employ 18 new staff to do a Newham and I hear on the grapevine, Southwark are also looking down the same road.

Many on the edge of the business call for councils to have more powers to deal with these problems but every enforcement officer I know says we don’t need them. What we do need is enough people to take action on what we do have. A bit of support from the criminal courts wouldn’t go amiss either.

As you know I believe the Newham approach is counterproductive and a partnership approach tied to an enforcement arm for the offenders is the way forward but you need enough staff, whatever way you work it.

Every enforcement officer knows the names of it’s bad apples and we know what properties they own too. We could target them alone quite easily but not without bums on seats. While staff are being continually cut the criminal landlord community will continue to run rings around us and licensing will be seen as a vote winning easy option.

Mark Alexander

15:10 PM, 9th August 2013
About 5 years ago

Reply to the comment left by "Ben Reeve-Lewis" at "09/08/2013 - 14:48":

I feel your pain Ben, one has to ask whether it's even worth bothering to tackle the problem.

If you had 1,000 extra TRO's would the problem go away or would you merely shuffle the cards a bit?

I liken this to the Americans in Vietnam, no matter how much they scaled up they could not win and eventually they realised it and pulled out but only after both sides had suffered horrendous casualties.

The bottom line is that there isn't enough property and their isn't enough money. Move one under-privileged person out of a bed in a shed and another will move in. Flatten the shed and another will be built because these people will still need a roof over their head.

Stealth taxes on the PRS will not help.
.

Mary Latham

15:22 PM, 9th August 2013
About 5 years ago

Reply to the comment left by "Ben Reeve-Lewis" at "09/08/2013 - 14:48":

So we are back to "raising standards or raising funds" and from what you are saying Ben licensing is being used to raise funds from the good landlords to pay enough staff to stop the bad landlords. Great!

Follow me on Twitter@landlordtweets

My book, where I warn about the storm clouds that are gathering for landlords is here >>> http://www.amazon.co.uk/dp/1484855337

Gary Chase

15:29 PM, 9th August 2013
About 5 years ago

Whilst I would not expect that a local authorty to know all the landlords that have properties that are likely to be below acceptable (legal) standards - whether disrepair or a otherwise, a reasonably competent authority is capable of pulling together a variety of information internally from their Environmental Health and Private Sector Housing Officers landlord forums etc to have a good idea where where the problems are likely to occur. My understanding is that there is a high likelyhood of problems where the landlord for instance has 'previous' for ignoring say building regulations and or planning permissions.i

However even if a local authority was keen to addrees the privae rented sector I suspect they would prefer to devote resources to other areas unless a licensing system and therefore a formal licensing regime enables a council to raise cash, employ staff and purport that 'problem' landlords are being addressed.

What seems to be lacking is any evidence that licensing works and the possibilty of otherr feasible options being considered.

The one size fits all appears to me akin to 'keeping everyone in class' approach to regulation rather than one that addresses the key offenders.

Ben Reeve-Lewis

15:43 PM, 9th August 2013
About 5 years ago

@Mary yes a fairly accurate assessment Mary. They could just as easily take on the extra staff to target the bad landlords and properties only.

@Mark, no I would never propose 1,000 TROs but working smarter would be a big help.

The problem so many councils face is an internal one that nobody has the political will to see.

• The enforcement teams to tackle problems in the PRS are:_
EHOs for property conditions,
• Planning Enforcement – for unauthorised conversions which seriously brings down standards across the board.
• TROs for harassment and illegal eviction
• Benefit Fraud to tackle widespread scamming
• Trading Standards for sharp practices amongst agents.
• Anti social behaviour teams

Outside of the council are
• EDF revenue to tackle cannabis factories and theft of electricity
• British Gas revenue for theft of supply.
• PCSOs and the police.

You see we don’t need extra powers. Put them all together and you have quite an army but the problem is that it is only in sporadic circumstances that any of these teams and organisations talk to each other.

Often they have different computer databases, so a person might be receiving a grant from one council team while another team is prosecuting them for fraud or failing to pay council tax.

Most frustrating of all are the various data sharing protocols where you know that another team has information that you need but they aren’t allowed to give it to you.

I guarantee you that I could take most of our bad landlords out of the game if I could sit down with all of the above on regular monthly meetings and chuck our various powers into the ring and swap information.

I do have links with several of the above and that is what happens when just 2 or 3 of us join forces. If we could get everyone into a multi agency task force you probably wouldn’t even need to employ loads more staff. Joined up thinking would go a long way.

And the frustrating thing is councils do work in this way in other circumstances. MAPPA panels made up of homelessness workers, social workers, police, probation officers, etc have been common place for years tackling clients who are a danger to the community but nobody seems to see the value of doing the same thing to target criminal landlords.

Mary Latham

15:53 PM, 9th August 2013
About 5 years ago

Reply to the comment left by "Ben Reeve-Lewis" at "09/08/2013 - 15:43":

Ben they need to speak to the team in the West Midlands that comprises West Midlands Fire Service, West Midlands Police and NHS. They are now sharing information which spots problems at an early stage. They are not yet sharing with local authorities but, through Homestamp, I expect this to happen in the near future. Prevention is always better than cure and when you consider the combined information of all these services you have an excellent early warning system and a much smarter way of working.

Follow me on Twitter@landlordtweets

My book, where I warn about the storm clouds that are gathering for landlords is here >>> http://www.amazon.co.uk/dp/1484855337

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