Tag Archives: Landlord Licensing

Ipswich Council refunding landlord licensing fees after Westminster Court of Appeal sex shop case Landlord News, Latest Articles

The RLA has recently received an email from Ipswich Borough Council confirming it has started to refund Landlord Licensing fees after the Westminster Court of Appeal sex shop case.

The Court of Appeal found in favour of a European Services Directive which clamps down on purposes fees can be charged by local authorities for landlords licences.

The RLA reported that the Council confirmed it is “currently going through their records to refund landlords of any fees charged on a HMO additional licensing scheme and that once the information is gathered, the Council will contact those landlords and arrange payment.”

The Court of Appeal decision in the Westminster Sex Shop Fees case Hemming t/a Simply Pleasure Limited v Westminster City Council affected fee charging for regulation such as for HMO and selective landlord licensing. Local authorities should abide by European Services Directive rules (ESD) when setting fees.

The ESD rules include:

A Local authority can only take fees for HMO licensing or selective licensing for

  • The actual and direct administrative costs of investigating the background and suitability of the landlord applicant
  • The cost of monitoring the compliance by licensed landlords with the terms of their licences
  • Fees must be reasonable and proportionate and can only cover the actual cost of the application process plus monitoring
  • Local authorities cannot include the costs of enforcing the licensing scheme against unlicensed landlords in the licence fee.
  • Set up charges for the scheme cannot be recovered.
  • Overheads and general administrative costs cannot be recovered and the running and capital costs of the relevant council department cannot be charged as part of the fee.
  • The Council is not allowed to make a profit.

If a Local authority ignores the European Services directive it could be forced to refund overcharged fees and pay interest. Landlords are allowed up to six years to submit a claim for being overcharged.

The RLA has contacted several local authorities to discuss this issue with them, and has been actively challenging other local authorities where licensing schemes are being proposed, such as Northampton Borough Council.

The case details below as reported by the ICLR:

Regina (Hemming (t/a Simply Pleasure Ltd) and others) v Westminster City Council

CA: Lord Dyson MR, Black, Beatson LJJ: 24 May 2013

Since the coming into force of the Provision of Services Regulations 2009 a local authority was not permitted, when determining the reasonable licence fee for sex establishments, to reflect in the fee which it determined the cost of enforcing the licensing system against unlicensed operators.

The Court of Appeal so held, allowing in part the appeal of the defendant local authority, Westminster City Council, from the judgments of Keith J on 16 May 2012 [2012] EWHC 1260 (Admin); [2012] PTSR 1676 and on 12 June 2012 [2012] EWHC 1582 (Admin) when he had allowed the claim for judicial review by seven licensees of sex shops, Timothy Martin Hemming (t/a Simply Pleasure Ltd), James Alan Poulton (t/a Soho Original Book), Harmony Ltd, Gatisle Ltd (t/a Janus), Winart Publications Ltd, Darker Enterprises Ltd and Swish Publications Ltd, of the amount of the annually renewable licence fee to operate sex shops for 2011–2012 determined by the local authority on the basis that the fee had not been determined for that year even though the same annual fee had been demanded of, and paid by them, as in previous years from 2005–2006, and had allowed a claim for restitution. The Court of Appeal upheld the judge’s decision except as to the basis on which restitution was to be made. In September 2004 the authority’s relevant committee had approved an annual fee for sex establishments for 2005–2006 reflecting the costs of administering and enforcing the licensing system which each claimant had paid on demand up to and including 2011–2012 without further consideration being given by the committee.

BEATSON LJ said that section 2 of the Local Government (Miscellaneous Provisions) Act 1982 required operators of sex establishments in areas of local authorities, which had resolved that Schedule 3 to the Act applied to their area, to have a licence. Paragraph 19 of Schedule 3 enabled a local authority to determine and charge a reasonable fee for the licence. It had been possible for the licence fee to reflect the cost to an authority of managing the licensing regime by enforcing it and prosecuting unlicensed operators as well as the cost of investigating and processing an individual application and monitoring compliance by licence-holders with the requirements of the licence: R v Birmingham City Council, Ex p Quietlynn Ltd (1985) 83 LGR 461, 517. Article 13(2) of Parliament and Council Directive 2006/123/EC of 12 December 2006 on services in the internal market (which had effect from December 2009 by the 2009 Regulations) and regulation 18(4) of the 2009 Regulations provided that charges for schemes requiring a person to obtain the authorisation of a competent body to have access to or to exercise a service activity could not exceed the cost of authorisation procedures and formalities. The defendant’s contention was that the judge’s failure to give the 2006 Directive and the 2009 Regulations a purposive construction meant that he disregarded the fact that the Directive was concerned with removing barriers to entry to a market and not preventing a licensing authority from requiring fees to cover the costs of enforcement activity hitherto accepted in national law, and where that activity was ultimately to the benefit of those holding licences; that enforcement benefited those with licences by protecting them from competition by unlicensed traders; and that absence of or much more limited enforcement would inhibit entry by legitimate traders. His Lordship derived assistance from two cases concerning other European Community provisions about fees and charges in understanding the general approach of the Court of Justice of the European Union, Germany GmbH and Arcor AG & Co KG v Germany (Joined Cases C-392/04 and C-422/04) [2006] ECR I-8559 and In re Shopping Centres Licensing: European Commission v Spain (Case C-400/08) [2011] 2 CMLR 1294. The indication from them was that the court had tended to prevent member states imposing costs on businesses which went beyond the costs of the authorisation, registration or inspection process, because such costs constituted illegitimate barriers to the exercise of fundamental freedoms or were inconsistent with principles of Community law. His Lordship rejected the other arguments of the local authority; they did not justify a departure from the clear wording of the Directive and the Regulations, or show that the construction adopted by the judge was inimical to the purposes of the Directive.

BLACK LJ and LORD DYSON MR agreed.Landlord Licensing


Alternative to licensing/accreditation? Bad landlords, look away now! Latest Articles, UK Property Forum for Buy to Let Landlords

Following on from the discussion entitled “Raising Standards or Raising Funds” it appears that the majority of readers agree that additional and selective licensing and property based accreditation schemes run by local authorities are not necessarily the best route forward. However, there does need to be a simple way of differentiating better quality landlords/properties for tenants in my opinion.

If the sector can self-regulate as much as possible, it would be certainly better than any government intervention.

So what about a simple graded quality rating for rental properties?

Much like the star rating system in hotels, it would be an idea that tenants would easily understand.

When it became an industry standard, rental prices would reflect the rating of the property.

What do you think should be included in such a star rating though?

Comment s/thoughts welcome from both landlords, tenants and letting agents.

Regards

Kirsty 5 star rated buy to let properties


Alternatives to Landlord Licencing Schemes Latest Articles, UK Property Forum for Buy to Let Landlords

The alternatives to Landlord Licensing Schemes require joined up thinking, changes to data sharing protocols within local authorities and revised high level directives and strategies which must begin at Government level. 

Perhaps the first question to ask is what is Landlord Licensing all about? Is it really about raising standards or is it more to do with raising funds?Alternatives to Landlord Licencing Schemes

Funding

If society as a whole desires that people should not be subjected to sub standard housing conditions then society as a whole must pay to enforce this (howsoever that might be done) whether the money is raised at a local level or centrally.

It is both unacceptable and wholly undemocratic that landlords should be singled out by Government, Councils and Local Authorities to pay stealth taxes badged as licensing fees on the pretence that the money will be used to fund enforcement related initiatives.

Costs associated with licensing schemes imposed on landlords are funded through increased rents. Neither landlords nor tenants want this, particularly as there is clear evidence (demonstrated in this article) that landlord licensing schemes have proven not to be an effective solution to problems in the Private Rented Sector.

Recycling of Court awarded penalties

The high costs associated with prosecuting criminal landlords is borne by Local Authorities, however, fines and penalties go to the treasury. If these funds were to be redirected to the prosecuting authorities this would assist funding of additional prosecutions and create incentives to bring more criminal landlords to task. Continue reading Alternatives to Landlord Licencing Schemes


Landlord Licensing Schemes – Raising Standards or Raising Funds? Latest Articles, UK Property Forum for Buy to Let Landlords

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!


Private Rented Sector Review – Conclusions and recommendations Landlord News, Latest Articles

The Private Rented Sector Review conclusions and recommendations published by the Communities and Local Government Committee:

Simplifying regulation

1.  We recommend that the Government conduct a wide-ranging review to consolidate legislation covering the private rented sector, with the aim of producing a much simpler and more straightforward set of regulations that landlords and tenants can easily understand. As part of this review, the Government should work with groups representing tenants, landlords and agents to bring forward a standard, plain language tenancy agreement on which all agreements should be based. There should be a requirement to include landlords’ contact details in tenancy agreements. (Paragraph 13)

2.  We recommend that the Government consult on the future of the housing health and safety rating system and the introduction of a simpler, more straightforward set of quality standards for housing in the sector. The Government should also ensure that planning and building regulations are consistent with standards for the quality and safety of private rented housing. (Paragraph 18)

Increasing awareness

3.  We recommend that, once the review of the legislative framework we have called for is completed, the Government, working with tenants’, landlords’ and agents’ groups, establish and help to fund a publicity campaign to promote awareness of tenants’ and landlords’ respective rights and responsibilities. Our recommendation for a wholesale review of the regulation in the sector provides the obvious platform on which to base a publicity campaign. (Paragraph 24)

4.  We recommend that the Government bring forward proposals for the introduction of easy-to-read key fact sheets for landlords and tenants, and consult on the information these sheets should contain. The sheets could include links to further information available online. As a minimum, the sheets should set out each party’s key rights and obligations, and give details of local organisations to whom they could go for further advice and information. This fact sheet should be included within the standard tenancy agreement we propose earlier in this chapter. (Paragraph 25)

Raising standards

5.  Some local authorities are doing excellent work to raise standards in the private rented sector, but there appears to be more scope for sharing this good practice, so that all councils are performing to a high standard. The Local Government Association should, as part of its sector-led improvement role, make sure that mechanisms are in place to ensure all councils learn from the good practice and take effective steps to improve standards of property and management in the private rented sector. (Paragraph 30)

6.  We are concerned about reports of reductions in staff who have responsibility for enforcement and tenancy relations and who have an important role in making approaches to raising standards successful. Given the financial constraints that councils face, it is important to identify approaches to raising standards that will not use up scarce resources. One approach is to ensure that enforcement arrangements pay for themselves and help to fund wider improvement activity. Therefore, where possible, the burden of payment should be placed upon those landlords who flout their responsibilities. (Paragraph 31)

7.  We recommend that the Government consult on proposals to empower councils to impose a penalty charge without recourse to court action where minor housing condition breaches are not remedied within a fixed period of time, though an aggrieved landlord would have the right of appeal to a court. (Paragraph 33)

8.  We recommend that, where landlords are convicted of letting property below legal standards, local authorities be given the power to recoup from a landlord an amount equivalent to that paid out to the tenant in housing benefit (or, in future, universal credit). We hope that such a measure will help to prevent unscrupulous landlords from profiting from public money. Local authorities should be able to retain the money recouped to fund their work to raise standards. To ensure a consistent approach, those tenants who have paid rent with their own resources should also have the right to reclaim this rent when their landlord has been convicted of letting a substandard property. (Paragraph 37)

Illegal eviction

9.  We do not agree that a statutory duty to have to take steps to tackle illegal eviction should be placed on local authorities, as it would be inconsistent with a localist approach. Nevertheless, it is again important that local authorities learn from each other and share best practice on tackling illegal eviction. The Local Government Association should ensure that lessons on illegal eviction are learnt and disseminated. (Paragraph 38)

10.  We are concerned that the police are sometimes unaware of their responsibilities in dealing with reports of illegal eviction. We recommend that the Department for Communities and Local Government work with the Home Office on guidance that sets out clearly the role of the police in enforcement of the Prevention from Eviction Act 1977. (Paragraph 39)

Licensing and accreditation

11.  The idea of national licensing has some merit, and such a scheme could bring a number of benefits, particularly if introduced alongside an effective system of redress. It is clear, however, that the Government has not been convinced by these arguments, and we have some sympathy with the Minister’s assertion that a national scheme could be very rigid. Having tailored local schemes may bring its own costs, especially for landlords operating across several areas, but on balance we would prefer to see local authorities develop their own approaches to licensing or accreditation in accordance with local needs. The Government’s focus should be on giving local authorities greater flexibility and encouraging the use of existing powers. (Paragraph 43)

12.  We recommend that the Government bring forward proposals for a reformed approach to selective licensing, which gives councils greater freedom over when licensing schemes can be introduced and more flexibility over how they are implemented. Councils should ensure that the cost of a licence is not set so high as to discourage investment in the sector. (Paragraph 49)

13.  We recommend that the Government give local authorities a power to require landlords to be members of an accreditation scheme run either by the council itself or by a recognised landlords association. (Paragraph 53)

14.  It is important that local authorities have options and tools to raise standards in their areas. Three particular options are: (1) greater use of landlord licensing schemes; (2) compulsory accreditation; and (3) taking a proactive neighbourhood approach to raising standards. In each of these cases, given resource constraints, the schemes have to pay for themselves, and, as far as possible, place the burden of payment on the unscrupulous landlords, with financial deterrents for non-compliance. Councils should be given the powers to impose heavy penalties on those who do not register for licensing or compulsory accreditation after appropriate notification. Neighbourhood approaches could be funded by local authorities recouping costs from landlords whose properties fail to meet minimum standards. We further recommend that the Government initiate a review of the fines imposed by the courts for letting substandard properties, to ensure they act as a sufficient deterrent. (Paragraph 55)

Houses in multiple occupation (HMOs)

15.  We recommend that the Government conduct a review of the mandatory licensing of houses in multiple occupation. This review should consider, amongst other things, evidence of the effectiveness of mandatory licensing, how well it is enforced, and whether the definition of a prescribed HMO should be modified. (Paragraph 58)

16.  Where there are community concerns about high concentrations of houses in multiple occupation, councils should have the ability to control the spread of HMOs. Such issues should be a matter for local determination. We therefore consider it appropriate that councils continue to have the option to use Article 4 directions to remove permitted development rights allowing change of use to HMO. (Paragraph 63)

17.  Universities have a responsibility to ensure that student housing does not have a detrimental impact upon local communities. They should be working with local authorities and student groups to ensure that there is sufficient housing in appropriate areas and that students act as responsible householders and members of the community. (Paragraph 64)

Safety standards

18.  We recommend that the Government work with the electrical industry to develop an electrical safety certificate for private rented properties. To obtain such a certificate, properties should be required to have a full wiring check every five years and a visual wiring check on change of tenancy. Landlords should be aware of the legal requirement to provide safe installations and appliances. (Paragraph 66)

19.  We recommend that the Government introduce a requirement for all private rented properties to be fitted with a working smoke alarm and, wherever a relevant heating appliance is installed, an audible, wired-up EN 50291 compliant carbon monoxide alarm. (Paragraph 67)

Regulation of letting agents

20.  We recommend that, as part of its consultation on the redress scheme, the Government seek views on how best to publicise such a scheme and what penalties should be in place for those agents who do not comply. The Government should also explore how the redress scheme fits alongside existing arrangements for deposit protection. We further recommend that the redress scheme is accompanied by a robust code of practice that sets out clear standards with which agents are required to comply. (Paragraph 74)

21.  We recommend that the Government make letting and managing agents subject to the same regulation that currently governs sales agents. This includes giving the Office of Fair Trading the power to ban agents who act improperly, and making client money protection and professional indemnity insurance mandatory. (Paragraph 78)

22.  Any proposal to require sales agents to meet minimum professional standards before they begin trading should also be applied to letting and managing agents. In addition, if at any point a requirement for sales agents to be registered with an accredited industry body is to be introduced, this should be part of a wider framework also covering letting and managing agents. We recommend that the Government review these arrangements in two years’ time. (Paragraph 78)

Agents’ fees and charges

23.  We recommend that the code of practice accompanying the new redress scheme include a requirement that agents publish a full breakdown of fees which are to be charged to the tenant alongside any property listing or advertisement, be it on a website, in a window or in print. This breakdown should not be “small print”, but displayed in such a way as to be immediately obvious to the potential tenant. The code should also require agents to explain their fees and charges to tenants before showing them around any property. Furthermore, the code should forbid double charging, and there should be a requirement that landlords are informed of any fees being charged to tenants. If agents do not meet these requirements, the fees should be illegal. Finally, the professional bodies should make a commitment to full, up front transparency on fees and charges a requirement of membership. (Paragraph 83)

24.  We intend to gather further information on the impact in Scotland of the decision to make fees to tenants illegal, and to return to this issue in 2014. (Paragraph 86)

Longer tenancies

25.  The demographics within the private rented sector are changing. No longer can it be seen as a tenure mainly for those looking for short-term, flexible forms of housing. While some renters still require flexibility, there is also an increasing number, including families with children, looking for longer-term security. The market, therefore, needs to be flexible, and to offer people the type of housing they need. The flexibility of assured shorthold tenancies should be better exploited, and the option of using assured tenancies should also be considered where these meet the needs of landlords and tenants. That we are beginning to see some institutions and housing associations offering longer tenancies under the current law suggests that we do not need legislative changes to achieve them. Rather, we need to change the culture, and to find ways to overcome the barriers to longer tenancies being offered. (Paragraph 94)

26.  We recommend that the Government convene a working party from all parts of the industry, to examine proposals to speed up the process of evicting during a tenancy tenants who do not pay rent promptly or fail to meet other contractual obligations. The ability to secure eviction more quickly for non payment of rent will encourage landlords to make properties available on longer tenancies. The Government should also set out a quicker means for landlords to gain possession if they can provide proof that they intend to sell the property. (Paragraph 97)

27.  Some landlords are not able to offer longer tenancies because they are prevented from doing so by conditions in their mortgage. We are pleased that lenders are considering how such conditions can be removed, and that Nationwide Building Society is to begin allowing its borrowers to offer longer term contracts. We urge the Council of Mortgage Lenders to work with other lenders to ensure that they quickly follow suit. Lenders should only include restrictions on tenancy length in mortgage conditions if there is a clear and transparent reason. (Paragraph 100)

28.  We recommend that the Government include in the code of conduct for letting agents a requirement both to make tenants aware of the full range of tenancy options available, and, where appropriate, to broker discussions about tenancy length between landlords and tenants. (Paragraph 102)

‘Retaliatory eviction’

29.  There is a perception amongst some tenants that if they speak out it could result in their losing their home. Tenants should be able to make requests or complain without fear that doing so will lead the landlord to seek possession. We are not convinced, however, that a legislative approach is the best or even an effective solution. Changing the law to limit the issuing of section 21 notices might be counter-productive and stunt the market. Rather, if we move towards a culture where longer tenancies become the norm, tenants will have greater security and also more confidence to ask for improvements and maintenance and, when necessary, to complain about their landlord. Moreover, if local authorities take a more proactive approach to enforcement, they will be able to address problems as they occur rather than waiting for tenants to report them. (Paragraph 105)

Rents and affordability

30.  Problems with the affordability of rents are particularly acute in London and the South East. Although in other parts of the country average rents and yields are relatively stable, we are still concerned that some families are struggling to meet the costs of their rent. We do not, however, support rent control which would serve only to reduce investment in the sector at a time when it is most needed. We agree that the most effective way to make rents more affordable would be to increase supply, particularly in those areas where demand is highest. (Paragraph 110)

31.  There is no perfect way to set rent, but, where longer tenancies are being established, linking increases to inflation or average earnings, or voluntarily agreeing a fixed uplift each year merit consideration and could provide tenants and landlords with a degree of stability, though over time mechanisms may emerge as, for example, in the commercial property sector. Tenants’, landlords’ and agents’ groups should encourage their members to discuss these options at the outset of a tenancy. Existing arrangements for setting and increasing rent are often arbitrary and uneven, and reflect the immaturity of the market. (Paragraph 113)

Placement of homeless households in the private rented sector

32.  We welcome the Government’s use of secondary legislation to clarify when accommodation is unsuitable for homeless households. We expect councils to pay full regard to this order and to ensure that homeless households are only placed in suitable accommodation. Given that many of these households will be vulnerable, councils have a particular responsibility to ensure that the properties they are placed in are free from serious health and safety hazards. We recommend that, as a matter of good practice, local authorities should inspect properties before using them for the placement of homeless households. (Paragraph 117)

33.  All agree that, wherever possible, councils should be placing homeless households within their local area (unless there are particular circumstances that mean it is not in the households’ interests). It nevertheless appears inevitable that councils in areas with high rents, London in particular, will place homeless households outside the area, including in coastal towns. Before any placement, there should be a full discussion with the receiving authority and the prospective tenant and information about the household and its ongoing needs should be shared. The Government should consider making this a statutory duty. (Paragraph 121)

34.  We were pleased to hear of positive examples of work to support homeless households in the private rented sector, including the establishment of social letting agencies and the development of private rented sector access schemes. We encourage the Government to work with local government, the charity sector and industry bodies to ensure best practice is shared and lessons learned. (Paragraph 122)

Local housing allowance

35.  We recommend that the Government take immediate steps to allow councils to apply for a variation of broad rental market area boundaries where anomalies occur. (Paragraph 125)

36.  We recommend that the Government conduct a wide-ranging review of local housing allowance (LHA). This review should assess whether there is greater scope for local flexibility over the setting of LHA rates and the boundaries of broad rental market areas. Local authorities could be incentivised to reduce the housing benefit bill by being allowed to retain any savings for investment in affordable housing. (Paragraph 125)

Data quality

37.  We recommend that the Government establish a small task group of key organisations and academics to consider how data relating to the private rented sector can be improved and made more readily available. In addition, we encourage the National Audit Office to contribute to an effective evidence base about the sector and to draw upon our recommendations when developing studies on housing related topics. (Paragraph 128)

Tax

38.  We recommend that the Government, in reviewing the regulation covering the private rented sector, set out proposals for greater co-ordination between the tax authorities and those regulating the private rented sector. (Paragraph 131)

Increasing supply

39.  We welcome the introduction and expansion of the Build to Rent Fund. The Government should take steps to ensure that the fund makes a net addition to new housing, as well as speeding up the delivery of those homes already in the pipeline. (Paragraph 138)

40.  It remains to be seen how much impact the guarantee scheme for the private rented sector will have in delivering additional new homes. The policy may be well-intentioned in its aim to encourage organisations to have more confidence to invest in the sector, but the Government needs to measure results. We invite the Government in its response to our report to update us on the number of applications it has received for the private rented sector guarantee scheme, and to provide an estimate for the number of additional homes it expects the scheme to deliver. If there is any doubt that the scheme is going to deliver the homes required, we recommend that the Government rapidly explore other options for the use of the resources identified. (Paragraph 142)

41.  We welcome the establishment of the task force to promote and broker investment in build-to-let development, and are pleased that the task force is already in operation. It is important that this task force does not become another quango but quickly delivers on its objectives. We invite the Government, in its response, to set out the progress made by the task force in its first few months of operation. This update should quantify the amount of additional investment brokered, and the number of additional homes it would deliver. (Paragraph 144)

42.  Efforts to promote high-quality build-to-let development have commanded significant amounts of government attention and resources. One of the main arguments in favour of this approach is that it will lead to improved choice, quality and affordability across the whole of the private rented sector. It is too early to assess the impact, but a key part of the evaluation of these measures must be the impact they have on the sector as a whole. If, in a year’s time, there is no evidence of this broader effect, the Government must reconsider its strategy and look to other measures to boost supply across the sector as a whole. (Paragraph 148)

43.  There is an urgent need to boost supply across all tenures of housing. We recommend that the Government revisit the Committee’s report on the Financing of New Housing Supply, and set out proposals to implement those recommendations it initially rejected. (Paragraph 150)commons logo


Private Rented Sector Review – Summary Landlord News, Latest Articles

The Private Rented Sector Review summary published by the Communities and Local Government Committee:

The private rented sector has seen sustained and consistent growth in recent years. A structural change from owner occupation towards renting began a decade ago, long predating the economic downturn. The sector is home to an increasingly wide range of people—from young professionals to housing benefit claimants—and a growing number of families with children. The regulation and legislation governing the sector has, however, evolved over many years, often in response to problems that arose decades ago. Only in the 1980s did the sector begin to emerge from tight rent control and the shadow of Rachmanism and begin to develop. The market is a developing one which we need to help edge its way towards maturity. This requires a careful balancing act which does not upset the market developing naturally. It therefore requires not a single step but action across a number of different areas.

First, there has to be better, simpler regulation. The Government should have a wide-ranging look at the legislation covering the sector and put in place a much simpler, more straightforward regulatory framework. Once it does this, it should launch a campaign to publicise this new framework, to ensure that all tenants and landlords are fully aware of their rights and responsibilities.

Next, we need to give councils the flexibilities they require to enforce the law and raise standards. They need the freedom to implement approaches that meet the needs of their areas. They should be: afforded more flexibility over landlord licensing; given greater ability to generate resources; and encouraged to learn from each other. Local authorities should be able to recoup housing benefit and tenants the rent paid, when landlords have been convicted of letting substandard property.

Third, there is strong evidence of sharp practice and abuses by letting agents, making a clear case for a new approach to regulation. Letting agents should be subject to the same controls as their counterparts in the sales sector. In addition, it is time to crack down on the unreasonable and opaque fees charged not only by a few rogues but by many well-known high street agents.

Next, with the sector home to an increasing number of families, we have to ensure that the market offers longer tenancies to those who need them. To do this requires a cultural change and the removal of barriers, both real and perceived. We need action to speed up eviction processes where tenants breach the tenancy agreement, tackle the objections of lenders, and encourage letting agents to explore all options with landlords and tenants with regards to longer tenancies. Alongside longer tenancies, we should find more systematic, less arbitrary approaches to setting and increasing rents. There should also be a full review of local housing allowance to bring to an end the vicious circle whereby rents and housing benefit drive each other up.

Finally, we cannot escape the need to increase supply across all tenures of housing. Doing so will provide more choice, allowing renters to select housing on the basis of quality as well as price. The Government has to ensure that the benefits of its support for build-to-let development extend to the sector as a whole. It should also revisit the recommendations of our earlier published report on the Financing of New Housing Supply, to ensure it is doing all it can to support the building of new homes.

Taken together, these measures should lead to a more mature market and a sector that better meets the needs of those who live in it. It is important that private renting is seen as an attractive alternative to owner occupation.

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New NLA Chairman is Carolyn Uphill Landlord News, Latest Articles, NLA - National Landlords Association

The National Landlords Association welcomes the new NLA Chairman, Carolyn Uphill, to the helm of the organisation.

Carolyn, formerly the NLA Deputy Chairman, joined the Board of Directors in July 2011 having worked as a Local Representative in Manchester since 2010.

Carolyn has extensive experience as a successful businesswoman and professional landlord letting student and private residential accommodation in and around Manchester.

Having established her own business in 1978, Carolyn successfully developed the enterprise to become a leading construction equipment manufacturer with a seven figure turnover.

In addition to running the business, which she sold in 2008, Carolyn has served as president of the Stockport Chamber of Commerce and continues to shares her wealth of business experience as a business growth consultant and mentor.

As NLA Chairman, Carolyn is keen to ensure the NLA serves and supports the private-rented sector (PRS) by pushing for continuous improvement of standards, greater recognition of landlords’ contribution to society and the economy as well as more cohesion between the private-rented sector’s representative bodies.

Carolyn takes over from David Salusbury, who is stepping down as NLA Chairman but remaining a Director and continuing as Chairman of my|deposits and the UK Association of Letting Agents (UKALA). David has led the NLA as Chairman since 2003 and has taken the organisation from a modest membership base of around 4,000 as the Small Landlords Association to a national body working with 39,000 landlords, 21,500 of which are full paying members. As part of its expansion, the NLA has grown to offer a wide range of services and represents landlords’ interests to both local and national government.

Carolyn Uphill, NLA Chairman, says “it is a great honour to be NLA Chairman at such an exciting time for the private-rented sector. During David’s time as Chairman the NLA has become an incredibly useful resource for landlords and an organisation respected by government. I look forward to building upon his success, supporting landlords in their journey towards continually improving standards and ensuring our voice is heard by policy makers.”

David Salusbury, NLA Director and outgoing Chairman, says “chairing the NLA and watching it grow and develop in response to the changing housing market over the last ten years has been a privilege. There have been many challenges along the way and there continue to be hurdles, such as landlord licensing and additional regulations, to address. I am confident that under Carolyn’s leadership the NLA will continue to grow and represent the needs of landlords throughout the country. I look forward to watching the NLA adapt to the needs of the evolving private-rented sector over the coming years.”

The change of Chairman coincides with the celebration of the NLA’s 40th Birthday.NLA logo colour


Newham Council new Landlord Licensing – advice needed Latest Articles, UK Property Forum for Buy to Let Landlords

Newham Council new Landlord Licensing - advice neededIf anyone is a current landlord in the borough of Newham please can you share your experience of council expectations of standard let properties?

I have reviewed their guide, however, today a letting agent commented that a buy to let property I was considering was very, very small and wouldn’t pass the council’s requirements.

I was surprised as the house was not small!

I checked the minimum square metre requirements for the bedrooms, kitchen and living/lounge/reception which seem to be pretty reasonable, i.e. not exceptionally large, e.g. 1 adult occupant in a bedroom, size must be minimum of 6.5 square metres.

Given the comment from the letting agent, I am now wondering if there is more to the story that is not being outlined/highlighted in the documentation that the council provide?

There is also a massive 30,000 application backlog in their system at the moment!

From what I have read, it appears at first pass that a landlord can’t legally let tenants move in until the license has been granted for new properties. The advice at the moment is that it takes 8 weeks to process the application (not sure if that takes current backlog into consideration), which is two months of mortgage payments without income from the property.

Is my understanding correct?

Has anyone bought and tried to license a property in Newham in 2013?

Any advice, warnings or tips you can offer will be appreciated.

Cheers

Sondra


Is landlord licensing a pointless exercise? Buy to Let News, Landlord News, Latest Articles, Property News, UK Property Forum for Buy to Let Landlords

Is landlord licencing a pointless exerciseIt’s time for me to share some controversial views on why I believe landlord licensing to be a pointless exercise I think.

Now don’t get me wrong, I hate the fact that a very small minority of bad landlords have earned our profession a bad reputation. However, it appears they might be a necessary evil too.

Allow me to explain. Continue reading Is landlord licensing a pointless exercise?


HMO Licensing – what’s the point? HMO's & Student Lets, Landlord News, Latest Articles, Property News, Question of the Week

HMO LicensingThis article about HMO Licensing is very different to many of the other articles I’ve written as I’m looking for answers as opposed to giving them.

I can accept that the principles of HMO licensing is to provide safe homes and I’m all for that but that’s not what I’m really getting at by raising the questions I have in this article.

Can anybody tell me the following please, either for their local area or the UK as a whole? Continue reading HMO Licensing – what’s the point?


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