It has been revealed that selective licensing schemes have really turned into a lottery for local authorities up and down the country with little to no evidence to suggest that they improve the local private rented sector.
Leicester City Council is considering the introduction of Selective Licensing to areas of the city where there are high levels of private rented accommodation. These include parts of:
- Braunstone Park and Rowley Fields
The scheme could also be introduced to other parts of the city if it was considered appropriate.
Under Selective Licensing anyone who rents out a property in a designated area would be required to be licensed by Leicester City Council. The council will check that the landlord is a ‘fit and proper person’ and, through compliance with licensing conditions, is providing safe and well-managed accommodation. A landlord in breach of their licence may be issued a civil penalty or be prosecuted. However, this is not really necessary as anybody who isn’t a fit and proper person who breaches housing regulation could receive a banning order.
Selective Licensing schemes and other measures that might be necessary to improve the social or economic conditions of the area are funded by licensing fees at the expense of tenants who would pay increased rents to cover the unnecessary tax on landlords. The schemes run for a period of up to five years and in the proposed areas, where the majority of households living in rented accommodation are on a low income or on benefits, tenants are likely to be at risk of homelessness as rents soar by up to £50 a month on top of proposed rent increases resulting from Section 24 reduction in mortgage interest rate relief, increased maintenance obligations under Homes (Fitness for Human Habitation) Act 2019 and the Tenant Fees Act 2019 which limits the deposit to five weeks and will already see tenants with pets’ rents rise by at least £24 a month.
Selective Licensing schemes have been established in many places around the country, with local authorities hoping for the following benefits for their communities which have so far not materialised:
- Better housing
- Increased housing demand
- Reduced crime and anti-social behaviour
- Image of the neighbourhood is improved and more desirable to live in
- Improved security and more settled communities
- Reduced number of empty properties
- Reduced environmental problems, such as graffiti, litter and fly-tipping
- Protection of vulnerable people who currently live in poor condition properties.
Leicester City Council is working towards a Selective Licensing scheme for less than 20% of the city’s private rented sector and less than 20% of the city’s geographical area but this could rise and is expected to do so as Leicester City Council realise how profitable it is for them, at the expense of Leicester Taxpayer – Leicester City Council has so far continuously carried out their plans knowing the financial impact this will have on local residents of Leicester. This means that the designation can be made by Leicester City Council and does not require confirmation by the Secretary of State.
[Consultation closes 5 May 2019]