Landlord licensing: The debate

From 1 April 2015 all privately rented properties in Liverpool will be required to have a license. The controversial landlord licensing scheme was given the go-ahead by Liverpool City Council in October, prompting criticism from a number of the city’s landlords and letting agents.

Initial proposals price the licenses at £500 per property, with discounts available to portfolio landlords.
Ahead of implantation of the scheme, Your Move brought together Councillor Ann O’Byrne, cabinet member for housing and Darren Hardy, head of housing at Liverpool City Council with agents Louis Anastasiou of Andrew Louis and Steven Latham of Concentric Lettings to debate the topic.

AOB) Following the Mayoral elections, the Mayor signed that pledge to say it’s extremely important that we need to tackle rogue landlords in the city. We then had to look at how we could achieve this. That’s when we began discussing the idea of a licensing scheme, and how one could be implemented. You could have selective licensing where you target one or two wards, but then how does that affect the other wards? And given that we have a private rental sector quite heavily within this city and it’s spread across the city, we thought the most effective way to do it was to do a citywide licensing scheme because we have no idea who the landlords are in this city.
We can estimate that there’s around about 50,000 private rental properties in the city but we have no idea who those landlords are and we’ve got no way of communicating with them. We know who our really good landlords are who have joined our CLASS system, (the accredited landlord licensing scheme) and we can engage with them. But the only way we will be able to tackle this is if we know who all the landlords are, so that’s why we decided to go for a citywide licensing scheme.

LA) We’re in total agreement with this and we’re advocates of regulations and offering a good standard of accommodation and maintaining that, but the process in our view is all wrong and it’s not just the implication of the licenses and the fee; my biggest concern is the conditions attached to the licence schemes.

We’ve been in consultation with Liverpool City Council for nearly seven months and I don’t think you’re listening. You’re not taking on board what we’re saying. We, as a group of licensed agents, probably represent around 20% of the stock in Liverpool city, and we’ve given you a proposal, we’ve not received a response on our proposal. This was given six months ago.

We work in the sector, we’re on the front line – work with us.

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AOB) We did set up a landlord advisory group that I chair. We’ve got landlords from across the city, we’ve got the North West Landlords Association on that, we’ve got the National Landlords Association on that as well as a number of other landlords and agents that sit on that group and we have discussed this process right the way through.

LA) Are they licensed agents?

AOB) Yes, and they have come forward with ideas and that’s why things have changed. They highlighted a number of issues and concerns that they had so we went back and we modified it. That dialogue has been ongoing and continues to be ongoing. Then there’s been the public meetings that we’ve had and the meetings that we’ve attended on behalf of the National Landlord Association. There’s been a whole series of discussions that have gone on. We brought in independent consultants because it was important that the city didn’t lead on the consultation because that would have been seen to be unfair. They carried out that consultation and met with a whole range of landlords and agents as well as residents, residents’ groups, elected politicians and the social landlord sector, so there was a whole series of consultation meetings.

All that has been fed into that final report, and of course the big one was the actual fee itself. We had to go out with a figure because we were going out with that consultation, but of course through that process and working with our advisory group, we have been looking at what would enable our fee to be reduced. If we worked in collaboration, if landlords were a member of say the National Landlords Association or another body therefore they’ve got all that information, would that help reduce the fee? That’s part of the work that’s been ongoing that we’ll be presenting in the next few weeks on what the actual fee is going to be and what the conditions are going to be.

Continued…

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About Author: Christine Toner

2 thoughts on “Landlord licensing: The debate

  1. DB
    February 19, 2015 at 7:57 am

    Is the £500 fee a one of payment or an annual payment. If its an annual payment, then well done Liverpool City council. Its £500 to you to waste and a £500 additional deductable expense for the landlord which means less cash to the Inland revenue. I bet you at least 70% of the £500 gets eaten up by bureaucracy. What a waste of time and money.
    So a property rented out at £400 a month will attract this fee, as will a property renting out at £4000 a month?
    Do they want to eliminate private landlords. Rogue landlords will not pay it, or will increase rents to cover it, is that what you want? in fact decent law abiding landlords will probably increase the rent.

  2. Les
    March 30, 2015 at 8:17 pm

    Hi

    I believe there may have been a misunderstanding regarding Landlords and Letting Agents. It does appear that
    you have invited a number of Letting Agents as well as lanlords to discuss the landlords licensing debate.
    Landlords pay letting agents to Manage their properties and find respectful tenants.This comes at a cost and hence in the current market the Landlord such as myself is running at a loss.

    The problem is with the Rogue Landlords not decent landlords who are contracted to a letting agent or to retired people whose children can’t get mortgages, so the retired person buys property for their children. They are now landlords and are being penalized for helping their children. Have the Council really thought this through; because it appears to me they have not.

    My letting agent inspects my property,ensures it is of a high standard, clean and tidy and the respective safety certificates and insurances are set in place. They then inform me how much I could rent the property out for. After the tenant has moved in, the property is inspected by the letting agent on a frequent basis. All repairs have to be actioned within 24hrs. The tenant is well looked after, if not they complain to the letting agent and if I do not act my rent is not released to me.

    In the majority of cases the rent is not a profit, it pays for the mortgage against the property. As I am not a rogue landlord I feel I am being victimized by the council.

    The Council is set to gain in excess of plus £10 million in licensing fees (25,000x£200). The letting agent is set to gain £50 per house for licensing administration charges he charges the landlord to register the landlord. What does a decent landlord gain for his outlay? NOTHING?

    Questions

    1 Will the Council ensure the Landlord Letting Agent receive the tenants DSS payment direct?

    2 Will the Council reimburse the landlord through the letting agent lost and overdue top ups if the tenant does not pay?

    3 Will the Council reimburse/cover all costs for the landlord through the letting agent for all loss/overdue rents
    and compensate the landlord for court fees the landlord has to pay the courts through the letting agent to evict a difficult tenant.

    4 Will the Council reimburse the landlord through the letting agent for damage caused by the tenant.

    I am a decent Landlord who over the past 8 years even though I am paying management fees to a letting agent have lost considerable sums of money in loss of rent and damaged to the property. A recent experience for me was I had to pay out £7,000 to carry out repairs to my property after a tenant left the property without paying rent for three months and flooding the property, even though the property was managed by a letting agent.

    I therefore respectfully request that the Council reviews it’s licensing Policy to ensure some form of protection
    and guarantees are made for the Decent Liverpool Landlords.

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