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Property Hawk

Landlord Licence Looms

Landlords, just when you thought it was safe to come out of the bunker in the belief that this Government has unleashed its last salvo of idiotic half baked ideas.  HIPs?
LHA? The National Identity Card (now to be a voluntary scheme in Manchester!) They top it all by proposing that every UK landlord has to get a licence.

Against landlord licensing? - Go to the landlord-licence petition and sign.

What I’m referring to is the widely held expectation that every UK landlord and there could be up to a million of us in the UK has to have a piece of paper costing £50 before we can let our property to a tenant.

Landlord insurance – discounted professional rates – in an instant

Landlord licence proposal
The suggestion is that the licence will be obtained from a national organisation, a so called national register of landlords.  Registered landlords will have to meet certain standards as the body will have the power to revoke their licence for example for bodging repairs or intimidating their tenants.

The licensing idea was floated recently in the Rugg report

National Landlord Association sits on the fence
So called landlord organisations like the National Landlord Association (NLA) who supposedly represent the interest of landlords continue to sit on the fence over the issue of landlord licensing.

Their response to the latest proposal of further government regulation of the private rented sector is to come back with platitudes:

Simon Gordon, of the National Landlords Association, said: “We can see the thinking behind this but we need to see the details and be reassured that this is not simply a mechanism for tougher regulations.”
 
Steady Simon, that sounds dangerously close to having an opinion.



Property Hawk says ‘NO’
Property Hawk says ‘NO’ to the landlord licence. We think it is unacceptable, in any shape or form. Here are six reasons why it is simply WRONG!

1. Letting property is a right.  Fundamentally I, as a landlord and law abiding citizen should be able to let my property to a willing tenant as a right.  I shouldn’t need to go cap in hand like a cowed child to some trumped up bureaucrat to get permission.

2. A landlord licence is no measure of competency. The concept of having a licence should not be confused with a measurement of competence or quality.  It is a licence.  This is neither useful to a landlord or to a tenant.  Really bad landlords will simply evade the licence or let their property even if they are banned which negates the whole purpose of having it.

3. It duplicates control.  The proponents of the licence have suggested it is a way of weeding out the really bad landlords by ensuring that only competent landlords will be kept on the register.  They suggest that two areas where landlords could be struck off the list are where they ‘bodge’ repairs or intimidate their tenants.  Again WRONG.  For a start most landlords who have property will use professional contractors to do work.  Will this mean where a plumber fails to fix a leaking toilet correctly that the landlord has to pay the price of no longer renting their property? If a tenant is unhappy that the landlord has not keeping the property in good repair they can already legally withhold their rent.  Intimidation of tenants has been used as another justification.  Landlords have been subject to strict legal control on intimidating tenants since the introduction of the 1977 law against tenant harassment.  
Why force landlords to have a worthless and costly piece of paper to duplicate control in a less effective manner?

4. It will restrict supply of rental accommodation.  Any restriction on ability of a property owner being able to let their property will inevitably serve to restrict the supply of rental property as some potential landlords will be put off from doing it, and some will move out of the rental market.  This is happening at a time when with increasing tenant unemployment, falling housing completion rates and struggling housing associations and the most difficult mortgage market in a generation means that the demand for affordable rental housing is stronger than ever.

5. Its’ a back door way of collecting more tax.  A landlord licence would simply be a tax on letting and renting resulting in either a landlord receiving less net rent by incurring the charge or the landlord passes the charge on to the tenant in the form of a higher rent. The fact that each landlord would have an individual licence number would make it easier for the Inland Revenue to cross check their records to see if the landlord is paying sufficient tax.  In other words it would be a back door way of snooping on a landlord’s accounts.

6. A landlord licence is costly and a waste of money.  Does any landlord who does their property management on a tight budget such as Property Sparrow think that any new landlord licensing authority will be as careful with their pennies?  The fact is the authority will employ a chief executive on a six figure sum and none contributory pension.  It will need a grand London office, PR staff, human resource department, bodies to monitor process data, finance managers, middle managers.  The list goes on.  Whilst landlords struggle to make ends meat a whole needless worthless band of bureaucrats will be dining out on our money!

Landlords - say ‘NO’ to a landlord licence

This government is devoid of direction and sense.  To cap it all they are determined to leave landlords with yet another piece of useless legislation. Priceless! Unfortunately it’s not, it will cost at least £50 and that will just be the start.  Just as previous Labour administrations almost killed the private sector with regulation and rent control. 

‘New’ Labour in their dying breath is finally showing their true colours.  They believe that the state always knows best!

My message to landlords who believe in the principle that they should be able to rent out their property to a willing tenant as a right and not as some earned privilege should support Property Hawks petition on the No.10 website. 

Go to the landlord-licence petition and sign.

Landlords should say ‘NO’ – to the landlord licence today before it’s too late.

Send us your thoughts on a landlord licence


Absolutely agree with all you have said. I feel the vast majority of landlords are honest law abiding citizens, who if they have good tenants, will do their best to keep them. We don’t need anymore  red tape than we already have. Is it being floated perhaps to make sure landlords are declaring all their income??
Sue Bell


Having been both a landlord and a tenant I see a number of issues with a Landlords License. First, it does not address the real issues for tenants and second, the way it is starting to look, is just another Stealth Tax that would be unenforceable for the most part.
 
I disagree with comments that a tenant is covered by other ‘laws & regulations’. In practical terms this is nonsense as long as there is the current Assured Shorthold Tenancy agreement. With this agreement, in the real world, a landlord can get away with almost anything, as the tenant knows that the landlord can give notice to quit, without even having to have a reason and the tenant has no alternative but to move. This is a major concern to good tenants as many, not so honourable landlords, use this as a weapon to get what they want from a tenant. Example: Landlord does not meet his requirements in maintaining the property or decides to raise the rent unreasonably. The tenant complains and the landlord issues a Notice to Quit. No real recourse for the tenant.
 
Secondly, it was said that landlords, for the majority use professionals to complete works to their properties. This, unfortunately, is not the majority of individual landlords. My experience, having owned and operated a property maintenance company for many years, is that they will try to cut corners wherever they can. OK, I agree that this is a business to make a profit and you have to be prudent, but not at the tenants expense. I can, if anyone wants, or would even listen, provide a large number of actual examples.
 
To solve the looming problem with the Governments penchant for Steal Taxes and bureaucracy is not more licensing or regulations, it is a revision to the Tenancy Agreement which requires a Landlord to prove Cause to be able to issue a Notice to Quit. This should include the Landlord being able to do so if the property is going to be sold or changed significantly that it would change the nature of the tenancy, not just at a whim.
 
Give the Tenants some rights with teeth in them and the problem could be resolved to the real benefit of both parties. Add new licensing, regulations or whatever, and you only compound the problem, adding unnecessary costs to both parties. Who benefits – the Government, of course.
 
M. Wolf
Essex


I own multiple HMO’s for which I have already had to get a license. It cost me 500gbp and is valid only for 3 years (or was it 5 years?). The condition of my HMO license is that I get on a landlord accreditation scheme and ensure the house is up to standard etc.
 
So, if I am already a licensed landlord, why on earth should I pay for another license?


landlords licience??? just another tax and another way of getting the sick and disabled to work, thanks a bunch brownie take your rabble of a government and do one!!! we don't need more taxes, - Lynn 


I dont think it is a bad idea for a license.
I will be happy if It gives more credibility to the Landlords.
Privately rented tenants as well will be re-assured.
I dont know how they are going to implement the monitoring of the Landord.
I really dont like the idea of charging any thing more than 50/- for the next 5 yrs.
Rather than charging yrly - why cant they charge for 3 yrs.
Charge again only if there is any investigation against landlord!!!
Karthikeyan


As long as I can remember, various Governments have had the notion that "all landlords are bad and all tenants are good", except of course, the official Landlord- the Council-
who let properties at subsidised rents.
The 1954 Landlord and Tenant Act reads like a horror story and parts of that Act still apply to Commecial Premises, I know, I got caught up in it and almost lost my property to a tenant I tried to help.
This is just another money making racket dreamed up by a defunked goverment.
NH Storbeck


Having been put through the mill by a tenant who did not pay their rent for several months as it was “inconvenient “for them and having been on the receiving end of a host of allegations from them to the local authority’s Housing association; none of which could be substantiated and in fact were proved to be false and without foundation by the tenants themselves.. I can without a shadow of a doubt say that those in authority already have a poor perception of us and will always take the tenants side and advise them on how to wriggle out of their contractual obligations and how to evade / prolong legal recourse. If these same people are given the authority to remove us as landlords on the basis of tenant allegations   HEAVEN HELP US !!!!!!!!!!!!!!!!!


The other point that seems to have been ignored, is that many (I would suggest most) Landlords use a Letting Agent to manage the letting of their property. A privilege for which they already have to pay handsomely, typically 10% of monthly rent + VAT.
 
If the Landlord Licence Proposal is essentially about improving behaviour towards the Tenants, then I don’t see the logic. In my personal case, I have a letting agent that exclusively deals with the Tenants and ensures that all of their needs are dealt with, including any repairs that the property requires from time to time and is authorised to instigate any repairs up to the value of £100 without needing to refer back to me each time. Again, I re-iterate that I pay 10% of the rent + VAT each month for this service.
 
Surely, in my case, it’s the Letting Agent’s behaviour that needs to be dealt with by the Government not mine. How would asking (forcing) me to have a Landlord Licence change this situation? Ironically, I can see situations where through no fault of their own, Landlord’s end up blacklisted (removed from the Landlord Licence register) simply because it was the Letting Agent’s screw-up/poor behaviour towards the tenants.
 
This is just another stealth tax, poorly thought through proposal by this incompetent Government.
Bring on the Election. - Matt


To M Wolf, Essex,
 Ref your statement
 “To solve the looming problem with the Governments penchant for Steal Taxes and bureaucracy is not more licensing or regulations, it is a revision to the Tenancy Agreement which requires a Landlord to prove Cause to be able to issue a Notice to Quit. This should include the Landlord being able to do so if the property is going to be sold or changed significantly that it would change the nature of the tenancy, not just at a whim.”
 
Happy with this approach as long as the Clause you propose also applies to the Tenant.


Here we go again. The reason I became a dam landlord was because I couldn’t sell my blasted flat when I had already bought and moved into the next house.

There are lots of people in the same boat, where they have been caught out by the credit crunch. The whole mess, which in part was due to mis-management of the economy by the present government.

I am making no money on the property, in the first year have made substantial losses, the second I expect to break even. The only reason I did it was that I wouldn’t have my records sullied by becoming a reposessee!


Being a Manchester landlord I have fallen foul of the new landlord licensing legislation.

I have read all kinds of comments about bad landlords, bad maintenance, etc and the reasoning behind landlord licensing.  In theory landlord licensing seems to have good motive. The reality, however, is glaringly different...

1) The stats bear out that the vast majority of properties and landlords are not bad. The bad landlord problem is therefore small in percentage.  Landlord licensing therefore is punitive to the vast majority and will (I can assure you from personal experience not theory) put off landlords from investing in property.

2) There is legislation that a local authority can use to ensure that a landlord keeps a property habitable. If the landlord ignores notices then the LA can carry out the works and send the bill to the landlord.

3) I have heard say that a landlord can give notice at the end of the tenancy without reason and often does so when a tenant complains.  This maybe true in I suspect a small number of cases, there is no data. Either way this is mute or ridiculous point because a) the tenant can also give notice without reason (and in my experience often does).  b) the landlord has to give two months notice (whilst the tenant only has to give one or even no notice at all at the end of the ast). c) human rights legislation will always give landlords the right to get back their property for personal reasons (i.e. I'm thinking of selling it and want to improve before I do.. and then oh I've changed my mind I want to rent again).

4) Perhaps the biggest reality is that landlord licensing does absolutely nothing for all the problems used to justify.  I know this from personal experience in Manchester.  I have two properties that are particularly high standard compared to even owner occupied.  I have been forced by Manchester to register as a landlord and it has cost me £1,000 for two properties. I want everyone to know that in my opinion this is a very blatant and obvious money raising exercise for Manchester City Council and I think a number of facts prove it...1) Manchester have not visited either property (or for that matter any property of other landlords I know) to find the condition.  2) The paperwork is long and complicated with penalties for incorrect completion  3) The only two possible problems the whole landlord licensing scheme can pick up on is a) invalid or not done gas check b) landlord criminal record (not sure if this means you can't be a landlord with a record or not)  4) Just look at the numbers .. Manchester will raise at least £3m from just several small areas of Manchester in one year.  Their cost would be around £500k from estimates I've seen.  That's a £2.5m profit for use in other areas.  If Manchester could expand this to their whole borough it would raise tens of millions.

In summary the real truth of landlord licensing is that it raises funds for cash strapped local authorities and does nothing (absolutely nothing) to improve private housing infact the opposite.  This is fact not theory from real application in a real area.  All those proponents of landlord licensing need to get out of their offices, of their computers and get involved in the areas that have been licensed.  Perhaps they don't want to do that because their personal yet blind investment in this ill conceived notion would force them to admit they are wrong.

Regards
D Court


How about a 'Tenants Licence' first, lets weed out all the bad tenants,  once rid of them........... happy landlord
Graham Collins


As much as I agree with all you've said and have signed the petition, unfortunatly, this government have a well documented history of ignoring the electorates thoughts and going back on promises.

I have two properties which fell under Selective Licensing.  We fought hard to get the conditions of licensing reasonable.  First they proposed that 'none of our tenants would sleep on settees'.  Fine I would then have to be there 24 x 7 to check that they were not sleeping on settees and the council would also have to be there 24 x 7 to check that I was checking!  Secondly they proposed that landlords should be responsible for ensuring that the tenant put the correct rubbish in the correct wheelie bin.  Again this would involve a 24 x 7 operation on my behalf and that of the council, or the hour before collection I would have to go through my tenant's wheelie bins and ensure correct composition!  I believe it is against the law to go into some one else's wheelie bin?  Fortunately common sense did prevail with this council.  Accreditation.  Now that is another laugh.  One of the conditions from anther local authority was that my property had to have running water (please note not hot running water, just running water).  And the bonus of being accredited, I would get a badge.  I run a local landlords association and have over 150 members and not one landlord to date has had a tenant ask whether or not we are accredited, or  where is the Energy Performance Certificate. Part of the licensing requirements is that I have to reference all prospective tenants through the council's referencing scheme which is only open to accredited landlords - again unnecessary duplication.  As one tenant stood up at the meeting and said 'I don't want us to have to be referenced.  My partner is in and out of prison all the time, what will happen to me and the five kids?'
 
The bottom line is there is already in place legislation for complaints against landlords. I do lay a lot of blame on the local authorities here.  They should provide easy anonymous access to a dedicated complaints officer. Our complaints against tenants can be dealt with by the courts or the wonderful anti social behaviour teams, who when I have called,  say 'we do not come out and visit tenants'.  I actually asked one of them what his goals were for ASB and indicated that it was not in his best interests to cure the problem.  And he (surprisingly quickly) acknowledged that it would cost him his job if the problems were solved.  I read some where that ASB cost the taxpayer £4.3 billion in one year.  There is a whole industry out there dependent upon it.  One of our local authorities employed 19 people for 20 months and as a result issued 2 ASBOs and 6 fly tipping notices.
 
So what is the point of a landlord license?  Taxation.  The only plus side is that hopefully it will be a national license (because lets face it, it is going to happen unless landlords step up to the plate and fight).  Selective licensing where you have a different license for each local authority is a non-sense - I only need one driving license.  They say they are licensing the property but they are licensing the landlord.  It is another way of making landlords responsible for their tenants' behaviour.  Tenants should have to carry a 'passport' of tenant history which should be signed by both landlord and tenant for each tenancy.  The problem is that the prisons are full and these societal misfits have to live somewhere after social landlords evict them.  This is the real world. How will a landlord paying £50 change all this?
 
Don't expect this proposal to be extended to social landlords.
 
Sue Thompson

ARE LABOUR TRYING TO KILL OFF THE PRIVATE LANDLORD ? AS A PROPERTY SPARROW {8 flats managed and maintained by myself] I  FEEL VERY AGGRIEVED ABOUT Energy Performance Certs  £69, PAYING £30 TO PROTECT EVERY DEPOSIT AND I'LL HAVE TO STOP PROVIDING  ELECTRIC FIRES BECAUSE I CAN'T AFFORD  Portable Appliance Tests. A LICENCE IS THE LAST STRAW !          Mrs Jen R-B

The most interesting one was that it will be easier for the Inland Revenue to check up.
Funnily enough, wasn't that one of the "spin-off advantages" for the DPS, much trumpeted as driving up standards in the industry, but having the curious, not-so-trumpeted "benefit" of allowing the Inland Revenue to make very quick enquiries?
Most, most, curious. - Sid

Perhaps not quite applicable to the licence issue but here is a tale from Sweden where I now live. In Sweden, as I private landlord you can sign an agreement with a prospective tenant to agree the amount of rent to be paid. There is a lack of rental properties in Stockholm so finding tenants is not a problem. But, let's say you agree on a figure of £1000/month which might be £200 more than what other similar properties cost. However, your tenant really wants to live there and signs up to that price. They can live there for some time and then may dispute the amount and can claim back the difference as the rent is deemed to be above the regulated rented  market price. So, the landlord ends up having to pay back the £200 x however many months even though the tenant signed a legal agreement to pay the full whack.
 
Sweden is essentially a socialist/capitalist country and when it comes to property rental and people do not pay as high rentals as in the UK. There are all sorts of authorities which set what rental prices should be - not market driven although becoming more so. However, in the centre of the city there is a mixed sector. Pulic sector workers can still afford to live in the city and these is less social separation than in many British cities. Less crime as well....
 
Lesley

Wholeheartedly support Landlord licensing PROVIDED all tenants also have to be licensed and accredited. - David

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This is a regular discussion point amongst many landlords.  Those that have been dissatisfied wit...
It's a landlords’ dread!   A nice respectable looking tenant, with a good...
Rebecca Brough of Fidler and Pepper Solicitors asks whether landlords need a tenant guarantor, and exp...
The thing with managing a portfolio of buy-to-let property is that for much of the time you don't have...
Brings Threats and Opportunities Many landlords are adopting a wait and see approach to the G...
Severe rental arrears fell by almost 16 per cent in the fourth quarter of 2012 according to data from ...
Should a landlord let their tenants smoke? Landlords are acutely aware of the bad smells and ...
New Year celebrations are well and truly over, so it’s back to work, and for many landlords, sma...
I was thinking today, what would be the top 5 things I would wish for next year as a landlord.  S...
You may think that as a landlord you are not liable for your tenants’ water bill. Well up until ...
I can't begin to explain how fraught the last few weeks have been.  Most part time landlords will...
The buy-to-let mortgage market has been in the doldrums for several years after the ‘crash&rsquo...
Rebecca Brough of Fidler and Pepper explores the world of fees and charges in respect to a landlords ...
Don’t forget your section 213 notice! Property Hawk has been urging landlord not to forget about...
You are just about to let your buy-to-let.  So what are the essential bits of paper work that you...
Is there such as thing as the ‘fair wear and tear’ of your buy-to-let property? ...
Landlords looking to obtain possession have two basic choices when trying to get their buy-to-let prop...
So it all goes wrong!  The tenant moves out (disappears) and owes you months of rent.  They ...
We recently had a enquiry on the Landlord Forum asking whether it was a good idea to serve a section 2...
Landlords seeking possession frequently have to decide between the merits of using a Section 21 notice...
Renewing a tenancy is one of the most straightforward aspects of managing a tenancy.  But many la...
Getting possession of a rental property when your tenant falls into rent arrears Th...
I read recently on a landlord forum a suggestion from one disgruntled tenant that landlords should be ...
My latest round of tenant gripes has hit me after a relatively quiet period. I suppose it was...
After launching the new version of the property management software we felt the actual site pages look...
Rental yields have always been a critical metric when evaluating a buy-to-let investment and they are...
Any landlord who follows London politics will not have escaped the fact that the private rented sector...
I was chatting this week to my joiner Steve. He was having a nightmare! Steve had done most o...
The Co-op announced last week that it was stepping up lending into the buy-to-let mortgage market by a...
Legislation should be in place by the end of the year to allow landlords to benefit from the Green Dea...
It's January which means only one thing for most landlords, yes it’s time to get to grips with t...
As the year comes to an end many landlords will be drawing up their plans for 2012. With the ...
I was contacted several weeks ago by one of our longstanding users. Kevin wrote to highlight ...
I'm like the majority of small landlords in that I have opted to use the Deposit Protection Scheme (DP...
Europe is at it again! Not content with their crazy project “Euro”  putting ...
You might be aware that I’ve had a number of new tenants recently. This has i...
It’s a great time to be a landlord. Many of us including me are making record rental pr...
I was contacted last week by a landlord looking to gain access to their bu...
I’ve written before about landlords not needing to use a letting agent. We al...
It's been a while since I've had a new tenant move in. The new tenant seems amiable enough. A middle a...
My landlord insurance fell due at the beginning of this month. DAMMM! Yet again the dilemma. ...
It is possible to get a company to fill out your N5B.  This will cost anything upwards of £...
Most landlords use an Assured Shorthold Tenancy agreement to let their property. So how long ...
I've been looking at some recent enquiries from landlords who use our Property Management software to ...
Most landlords who let a property that is tenanted will not be liable for council tax.  This is b...