An increasing number of local councils are choosing to implement selective licensing and introduce harsh penalties for private landlords which go beyond the government’s mandatory licensing rules, according to research. According to a study from law firm, Kirwans, the legislation, which was introduced within the Housing Act of 2004 to tackle anti-social behaviour, irresponsible landlords and poor-quality rental homes, has enabled local authorities to regularly pursue the most severe enforcement options available to them. This can occasionally result in unreasonable penalties for landlords.
Managing partner at the law firm, David Kirwan, stated that there are various ways in which local authorities can punish landlords who fail to comply with legislation and the rules concerning selective licensing. This ranges from providing support, guidance or advice, and issuing simple cautions to prosecuting landlords using the courts and revoking or refusing licences. A pattern has begun to emerge of councils choosing to enforce the most severe options as they try to make an example of the landlords who fail to abide by the regulations.
Mr Kirwan went on to explain that some of his own clients have invested in property in order to provide a pension fund in retirement or raise additional income, only to find themselves summoned to court for failing to apply for the correct license, and they have been left devastated by the action. He explains that although the problem of unethical landlords should be dealt with to ensure the protection of the most vulnerable tenants, some good landlords just entering the sector may be unaware of the schemes which have been introduced. To suddenly be faced with penalty fines is terrifying for many of Mr Kirwan’s clients.
In some worst case scenarios, landlords have been handed criminal records, banned from letting homes in the future or ordered to repay a year’s worth of rent. Even if local councils choose to bypass the courts, there are civil penalty fines of a maximum £30,000 which can be imposed. Landlords must apply for licences for each of their rental homes that are located within the designated areas for selective licensing schemes, which apply for a five year period. After an assessment, the landlord is then awarded the licence to operate once they have been deemed proper and fit, in addition to satisfying stipulations based on health and safety, funding and management of the property.
The schemes, which critics claim are a method for councils to boost their funds, has encountered criticism surrounding the cost that landlords must bear, which can be hundreds of pounds, as well as the potential for the schemes to drive rogue landlords even further underground rather than exposing them. Rogue landlords may, instead, choose to operate in areas which do not currently have a scheme in place and avoid areas with licencing schemes.
The schemes have also often proved confusing for landlords, with some unaware that their property lies within a selective licensing area. In particular, those operating in numerous areas can find the situation bewildering, with each council creating their own rules for the scheme. The Government announced in June that a review of the selective licensing scheme will take place to analyse if it is meeting its objectives. The findings are due to be published in Spring 2019.
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