Selective Licensing – A Potential Bonanza for the Council

selective licensing council08:12 Wednesday 15th February 2012
Peterborough Breakfast Show
BBC Radio Cambridgeshire

JOANNE HODGES PETERBOROUGH CITY COUNCIL: .. we’ve also got the thing called Selective Licensing, which is another tool that we’re considering using within the Millfield and New England area. That means that all rented accommodation within that area would need to be licensed. So it would allow us to work with landlords, and landlords that don’t comply, to tackle things like anti-social behaviour, and the fact that they don’t give rent books, tenancy agreements, litter, that kind of thing. It would give us a lot more control over those issues.
PAUL STAINTON: So you can target the areas, because you know where the areas are where there’s a problem.
JOANNE HODGES: Yes we do. And we currently have an HMO licensing scheme within the Millfield and New England area, which has been successful. We’ve had some good prosecutions on it. Not all the landlords have come forward and licensed, so we are at a stage where we’re fighting the landlords that won’t license. But by increasing that, and including .. changing to Selective Licensing, we will tackle the HMOs with two people, two or three people in them. It will include all of the rented sector.
PAUL STAINTON: So Millfield and New England is one area. Is there any other areas across Peterborough that you’re targeting?
JOANNE HODGES: Not currently. We’re using Millfield and New England because we currently have the licensing scheme there at the minute.
PAUL STAINTON: Yes. What happens when you go in to these places? .. landlords have limited powers effectively, once they’ve got people in their houses. They can’t .. it takes a lot to get rid of somebody from a house, doesn’t it? What happens when you go in?
JOANNE HODGES: Well when we go in, the majority of the houses are absolutely fine. People do choose to share because of the economies of it. I know it’s not what we’re normally having. In our country we don’t normally share except if it’s a family unit. But there is a need for this type of accommodation. It’s just about making landlords comply, where they should comply, and controlling the tenants where there needs to control the tenants.
PAUL STAINTON: But there’s a cost, isn’t there, for planning. There’s a cost for licensing. And I can see landlords listening this morning, going hmmm.
JOANNE HODGES: There is. But there is a cost to everything. We’re talking about targeting the real rogue landlords, the ones that just go round, collect the rent, clear off, and don’t repair the houses, don’t look after their tenants, aren’t bothered whether the tenants fill the gardens full of rubbish, and that kind of thing. So it will tackle those types of landlords. It will also impact on the good landlords as well. But in the area that we’re talking about, we’ve got a lot of bad landlords.
PAUL STAINTON: So ultimately, you would go in, give them a warning to start with?
JOANNE HODGES: We would ask them to license, yes. And if they don’t license, then we’ll take action against them.
PAUL STAINTON: What does that involve?
JOANNE HODGES: It could be anything from prosecuting them for not licensing, which will be a legal requirement, to taking over the management of the house, and the Council effectively managing the house, and taking it away from them for a period of time.
PAUL STAINTON: So you would actually take the house off them.
JOANNE HODGES: We’ve done that on three occasions in the past year.
PAUL STAINTON: In Millfield?
JOANNE HODGES: Yup.
PAUL STAINTON: Right. And what was the outcome of all that?
JOANNE HODGES: The outcome .. one of them is ongoing. Two of them, both of the landlords were prosecuted for not licensing the properties, and got fines range of between ten and fifteen thousand pounds. And we effectively took the house away. They didn’t have any control over that house. We’ve put all the fire safety and repairs, and did everything like that. Got all the tenants so they knew what their rights were as regards tenancy agreements, rental agreements, that kind of thing. And eventually the houses became licensed and were managed.
PAUL STAINTON: So watch out. If you don’t license, we could be coming for your house.
JOANNE HODGES: We certainly can.
PAUL STAINTON: Do you keep the rent, by the way, from that?
JOANNE HODGES: No we don’t. We use it for the repairs, and to bring the houses up to standard. And any excess rent goes back to the landlord.
PAUL STAINTON: OK. Well listen, thank you for coming in this morning. Good luck with it, in a very challenging economic times ..
JOANNE HODGES: Thank you.
PAUL STAINTON: .. austere times, with less and less resources. We will try and crack down on the problem, is what Joanne is saying, from Peterborough City Council.

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1 thought on “Selective Licensing – A Potential Bonanza for the Council”

  1. As a Landlord with a number of properties in Peterborough, I recently received a questionnaire regarding a proposed enforcement of Selective Licensing scheme in Peterborough.
    Joanne Hodges says she wants to ‘crack down’ on rogue landlords – which I applaud – however, how does charging landlords – that currently do all the things that Joanne Hodges suggests – £600 per property help?

    I am a Landlord with 6 properties in Peterborough and elsewhere covering 5 councils. ALL of my properties are managed by high-street agencies that charge a minimum od 12% and they ensure ALL legal requirements are met – Gas cert and electrical safety for example. I understand the Councils desire and requirement address anti-social behaviour and rogue landlords but Selective Licensing (SL) is NOT the answer to rogue Landlords.
    Anti-social behaviour needs to be addressed by the parents, communities and police – in that order. Councils are not truly in a position to correct this behaviour without the direct intervention and support of the above and Landlords certainly aren’t.
    Rogue Landlords exist and will always exist, rogue Landlords will find ways and tenants that want to stay below the radar and as such will not use high street management companies to manage the tenant and the landlord – not that all Landlords that ‘self manage’ are rogues.
    The introduction of SL will only penalise ‘good’ Landlords, as most, if not all of the SL conditions are enforced by Landlords agents.
    Rogue Landlords will not inform the Council that they are ‘Landlords’ (to avoid TAX and legal requirements) and therefore will not pay for a SL – in the same way they ignore the TDS – the £5,000 fine will have little or no effect. There are laws currently in place for tenants to challenge rogue Landlords – why do the Council feel additional laws will change the situation?
    The introduction of Tenancy Deposit Schemes (TDS) was supposed to address this issue but for the reasons above can and did not. TDS has only added an additional cost, per Tenancy (£30) to Landlords that in the main are ‘good’ Landlords. The introduction of SL will add an additional £600 per property (£120 pa). While the media and some politicians complain about high and increasing rent costs, this is only in inner London and distorts the true National picture where rents have changed little. The introduction of a SL will have to be charged on to the tenant and any Landlord that uses a rental agency will have to charge £13 per month to cover the VAT. The introduction of TDS and the change in the collection of Council tax (once exempt for the first 6-month for non-furnished properties – now individual Councils have the option of charging for vacant properties) has effectively removed any rise in rents.
    While my own experience of the TDS has been poor – from my point of view – it has only served to assist poor tenants to claw back 50% of their deposit (the DDS apparent default position on any claim) even when repairs and vacant periods are created through no fault of the Landlord.

    To answer some of the specific Licence Conditions:
    • A gas certificate is already law and enforced by agencies
    • Electrical and furniture safety is already law and enforced by agencies
    • Smoke alarms are already law and enforced by agencies – although tenants often remove the batteries
    • Tenancy agreements are already law and supplied by agencies
    • References are already obtained by agencies, although new migrants sometimes find this a problem due to no ‘in-country’ history
    • Category 1 hazards is a statutory requirement already
    • If it is already a legal requirement for some properties to have an Electricity Performance Certificate (EPC) – but do not – why do the Council think a SL will help?
    • It is not currently a legal requirement for a property to hold or supply an electrical Portable Appliance Test (PAT) tests. Should this become law or part of the SL it will add an additional £100 per year
    • Rental agencies already advise tenants about waste and should enforce without the need for an SL
    • Landlords rarely live in the rented property and as such can not know if the property is overcrowded. As it is a legal requirement to inform the tenant of a visit by landlord or their agent, it is easy for the tenant to ‘manage’ the apparent quantity of tenants
    • Rental agencies ensure properties are clean at change over and during vacant periods
    • Tenants are legally entitled to stay in a property for the duration of the signed for tenancy. Only the law can provide legally binding evidence of criminal or anti-social behaviour
    • Council incurred expenses – is not adequately explained
    • Property management courses – no doubt at an additional cost

    The SL is another attempt to fix a problem at the expense of ‘good’ Landlords.

    If creating legally binding controls were the answer to the ‘Rogue Landlord’ issue then the TDS would have had an effect. The Government brought in TDS in an effort to resolve the vast majority of the proposed SL conditions, at an additional cost to Landlords and by default, tenants. If the TDS has not delivered the required results, the answer is not to create another scheme financed by ‘good Landlords’ but to make sure the original TDS scheme works or is enhanced to cover additional requirements. The proposed SL will only add additional costs to Landlords and Tenants, rogue Landlords and tenants that do not want to pay the market value, will still continue to exist and evade the system.

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