Jan

There’s been a rash of councils applying for new licensing schemes

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Landlord licensing:

New Government funding and a crack-down on rogue operators is resulting in a whole host of new licensing scheme proposals being introduced throughout the country.

If this improves safety and drives out more rogue landlords then most landlords will say so much to the good, but this comes at a cost to individual landlords – it means licensing fees for every letting, the actual amount depending on that set by their local authority, but they range from in the region of £400 to £800 per property every five years.

There are two main
types of licensing schemes: selective and additional, as well as
mandatory HMO licensing.

In areas where
selective licensing applies, and as the name implies, it may affect
part or the whole of a district of borough, landlords must apply for
a licence if they want to rent out a property.

This means the
council can check whether the landlord is a “fit or proper person”
to be a landlord, and will be making other stipulations about the
management of the property and safety measures.

Additional licensing comes under Part II of the Housing Act 2004 and applies to certain types of Houses in Multiple Occupation (HMOs) that fall outside the scope of the mandatory HMO licensing scheme. To decide if you have an HMO you can read the legislation itself (Sections 254 – 260 Housing Act 2004), though a simpler guide is on the houses in multiple occupation gov.uk website.

As a general rule an
HMO is any property (house or flat) occupied by three or more people
comprising two or more households (friends or strangers, not
families) who share facilities (kitchen, bathroom and/or toilet) and
occupy the property as their only or main residence. If in doubt you
should seek a determination from your local council.

The penalties for
non-compliance are very high, and it is thought that since a recent
change in legislation there are many thousands of otherwise
law-abiding landlords unaware they have an HMO, or they are operating
in a selective licensing area.

Councils are
introducing landlord licensing schemes at an alarming rate and not
just the mandatory HMO schemes but selective and additional ones as
well. With new Government funding, many councils are now clamping
down on rogue landlords by introducing new selective and additional
licensing schemes, so landlords need to keep an eye on their
council’s website for information on this.

A local authority
may designate either the whole or a part of its district as subject
to selective licensing of residential accommodation. Before making
any decision to introduce licensing the local authority must consult
with those who are likely to be affected, including those who live,
work or operate businesses in adjoining local authority and all areas
where they will be affected.

A decision to
designate an area subject to selective licensing may need approval
from the Secretary of State for Housing, unless a minimum 10-week
consultation period has been allowed after it produced a draft
proposal identifying what is to be designated and its consequences.
Selective licensing can then come into force no earlier than three
months after the designation has been approved.

Here is a sample of
councils currently in consultation or introducing schemes include:

Oadby and Wigston
Borough Council is consulting on selective licensing in one of
its wards which will close 30 January 2020.

Oxford City
Council has confirmed that it plans to publish a consultation
this summer setting out the case for introducing borough-wide
licensing covering an estimated 20,000 private rented homes in
Oxford. Currently the city council requires all HMOs to be licensed.

Bournemouth,
Christchurch and Poole Council has started a
consultation on proposals setting out the introduction of selective
and additional licensing schemes in the borough. The consultation is
to close on 6 April 2020 and will affect Southbourne, Boscombe,
Pokesdown, East Cliff & Springbourne, Westhill, Westbourne and
Bournemouth Town Centre, Poole Town, Winton and Charminster.

Coventry City
Council has confirmed it will progress a selective licensing
scheme following the outcome of its consultation, and the housing
cabinet confirmed that additional licensing will also be implemented.
The city-wide additional licensing scheme is due to take effect on 4
May 2020.

In addition,
Birmingham City Council plans to introduce a city-wide Article
4 Direction from 8 June 2020. This means that landlords in
Birmingham have until 7 June 2020 to undertake developments to change
the use of a house / dwelling to a small HMO under permitted
development rights. Landlords with existing small Houses in Multiple
Occupation (HMO) should declare these to the Council before the
direction takes effect. They will need evidence of their existing use
as an HMO letting.

Elsewhere, Liverpool City Council have been refused the renewal of their city-wide licensing scheme. The new housing secretary Robert Jenrick has turned down an application by the Council to extend Liverpool’s city-wide selective licensing scheme for private sector landlords for another five years.

An Independent Review of the Use and Effectiveness of Selective Licensing

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