9:52 AM, 11th December 2023, About 11 months ago 23
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For anyone wondering what the impact of selective licensing schemes is on tenants and rent prices, then one landlord has news for you.
He claims that the selective licensing scheme introduced in Nottingham in 2018 is to blame for massive rent increases in the city.
And his opinion is backed up by new figures from the Office for National Statistics (ONS) which reveal that rents in Nottingham have rocketed by nearly £200 since the scheme began.
Nottingham City Council introduced its selective licensing scheme in 2018 and a further scheme has been introduced this month.
The council denies that rent rises since then are down to its licensing scheme but rising interest rates.
Mick Roberts, one of Nottingham’s largest landlords to house benefit tenants, told Property118 that the ONS figures reveal a sudden surge in rental costs after selective licensing was introduced.
The council introduced the first back in August 2018, when rents in the city were £664. However, rents have been increasing rapidly since the scheme has been implemented.
The average monthly rent in Nottingham in October this year were £859 – that’s nearly a 30% increase from 2018.
Mr Roberts says the council cannot continue to deny the impact the scheme is having on housing supply.
He said: “If you ever wanted any evidence that selective licensing puts rents up, it’s here in black and white. How can the council deny this?”
The current cost for a licence in Nottingham is £520 for the first payment (Part A) and the second payment (Part B) is £370. That’s £890 per house. Have more than one rental property and landlords are looking at a hefty outlay.
When approached for comment, Nottingham council did not dispute that rents in the city have gone up after licensing was introduced but, bizarrely, told us that selective licensing is not to blame and the reason is down to recent interest rate hikes.
A spokesperson said: “The increase in rents that are quoted from the ONS data 2018 to 2023 might have something to do with the huge spike in interest rates in the past couple of years, pushing up mortgage payments for thousands of landlords.”
In reply, to the council, Mr Roberts said licensing schemes are not beneficial to tenants or landlords.
“There are other external factors such as interest rates but in Nottingham, selective licensing kick-started this upward spiral of rent prices.
“Landlords and a majority of tenants have seen no gain from selective licensing.”
It’s not just Nottingham that has seen an increase in rent prices due to selective licensing.
Newcastle City Council introduced a selective licensing scheme in April 2020 covering five areas and a further two areas were introduced in October 2021.
According to the ONS data, rents in April 2020 in Newcastle were £800 per month and soared to £963 in October 2023, a 20% increase.
Prices for the selective licence are £650 a year but the council say these schemes punish bad landlords.
In a council meeting, Newcastle’s city council, head of public safety and regulation, Ed Foster said: “What we are doing is driving out the bad landlords. One agent has lost a portfolio of over 100 properties because of poor property management.
“It is that kind of action that should be what we are doing, and by rewarding good landlords we’re showing that we are pushing for improvement. What I think we’re doing is flushing out those landlords who are not managing properties.
“We want to make sure everybody has a decent home. The scale of the property conditions that we’re finding is a significant issue.”
However, the National Residential Landlords Association (NRLA) has argued that selective licensing schemes do not offer any effective solution to property management.
Chris Norris, the NRLA’s policy director told Property118: “Local authorities are often too enthusiastic to implement or expand discretionary licensing schemes without regard for their effectiveness or suitability.
“Whilst there are instances where a selective licensing scheme might be appropriate to deal with a concentration of poor standards or behaviour in a very limited area, it is usually far too blunt an instrument for large areas or entire boroughs.
“NRLA research has previously revealed there to be little to no correlation between the expansion of licensing and more effective enforcement or improved outcomes at a local authority level.”
He added: “Rather than committing to ever more discretionary licensing, or calling for more powers, we would like to see local authorities tackle issues related to poor standards and practices using the extensive powers already available to them and supporting responsible landlords to continue to provide quality housing.”
The debate continues to rage against selective licensing with councils disagreeing they cause high rents and blaming external factors such as interest rates.
However, up and down the country councils are expanding licensing schemes, but at what cost to landlords and tenants they are meant to be helping?
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Reluctant Landlord
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Sign Up15:29 PM, 11th December 2023, About 11 months ago
Reply to the comment left by Ross Tulloch at 11/12/2023 - 12:06report the new owner. Exactly what I did in a similar situation. You can do this anonymously.
If we are being forced to comply and as a result the situation that transpires is ironically enough - exactly what the 'rules ' were supposed to avoid (in this case a min room size for everyone) then if you know this is NOT being complied with then give the info to the council and let them prosecute! Let them fine the bad guys!
Mick Roberts
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Sign Up15:44 PM, 11th December 2023, About 11 months ago
Reply to the comment left by Grumpy Doug at 11/12/2023 - 10:03
Yes, none of these Council & Govt hair brained schemes have any thought to the tenant may not be paying market rent.
Mick Roberts
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Sign Up15:44 PM, 11th December 2023, About 11 months ago
Reply to the comment left by Easy rider at 11/12/2023 - 10:48
U say it well Easy Rider, if only the mainstream Media would get this out there.
Mick Roberts
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Sign Up15:45 PM, 11th December 2023, About 11 months ago
Reply to the comment left by cashcow at 11/12/2023 - 11:05
Yes, u can get a boiler serviced for £50, EPC £50, all visits that take time. Yet we pay £890 for Council to check these documents without moving.
Mick Roberts
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Sign Up15:46 PM, 11th December 2023, About 11 months ago
If anyone has more time than me, we could do with doing Freedom of Information FOI requests on all Councils what their homeless hill is for hotels and temporary accommodation.
Since you introduced Selective Licensing.
And also to the Councils that don't have Selective Licensing.
Be nice to see (because there is one) how big the direct correlation is from those Councils with Selective Licensing and those without.
Nottingham's has shot up and they can say there are bigger issues at play here, and there are, but Selective Licensing started it all and massively contributes to it now.
I know Newham was the first to introduce Selective Licensing and their homeless was also the biggest rise afterwards
cashcow
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Sign Up17:18 PM, 11th December 2023, About 11 months ago
piggy backing Micks request Can someone also check out how much LL contribute to the country in taxes I believe it was 16.1 billion in 2019 in pre tax spending its probably double that now.
LaLo
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Sign Up18:16 PM, 11th December 2023, About 11 months ago
I had a property where licensing came in, I sold ! I considered my property was up to scratch but when the ‘tin god’ comes with clipboard they’ll find something wrong - somewhere! The thought of £30,000 - unlimited fines is just not worth the worry! Councils are simply after money since 50% government subs have gone. 20MPH zones popping up everywhere is another trick! Everyone take a look at the Labour manifesto pages 13 - 15. Bye!
David100
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Sign Up18:51 PM, 11th December 2023, About 11 months ago
The area I live has had landlord licensing for 8 years now. So what exactly has been the benefit to the tenants? They can look up the property they are renting in a register, and it will tell them the landlords name.................Thats it............thats the sum total of it. The landlords are paying the council money, to put them on a register. Unlike certain others who are put on a register.............. for the criminals its free.
Crouchender
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Sign Up19:06 PM, 11th December 2023, About 11 months ago
Reply to the comment left by David100 at 11/12/2023 - 18:51
Bottom line is when Labour gets in they will insist on more red tape for LLs. Ie every property to be inspected and certified. So yes then is the time to sell up when you weigh up the costs of the changes to be ‘ certified’ although expect higher CGT. from them
Mick Roberts
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Sign Up5:57 AM, 12th December 2023, About 11 months ago
Reply to the comment left by LaLo at 11/12/2023 - 18:16
I've said the same this week on Unlimited fines:
Tenant's and Generation Rent. Do u want to know why your rents are increasing and Landlords are selling and you are stuck in Council homeless hotels?
Imagine you are the most law abiding person possible and your Housing Provider is trying to house people at a sensible rent while still paying your ever increasing outgoings caused by Govt and Councils
You've just had new boiler and kitchen and you paying £2000 a year less rent than all your neighbours.
And then your Landlord receive the words below from the Council. Part of my replies to Licensing too.
https://www.linkedin.com/feed/update/urn:li:share:7139666457109377024/
You say:
not mere recommendations; they are statutory requirements that demand our attention
Who you talking to, a kid? Are we guilty before proven innocent?
conviction to an unlimited fine?
What have we done wrong? Why not fine us £1 million?
firmly safeguarded in statutory law by Nottingham City Council.
Exactly, a bankrupt Council has made up the law.
it is a criminal offense.
Criminal offence? What we done wrong? And you can't even spell the word.
You are causing & complicit to the criminal offence as it is YOUR website that is NOT letting us License.
it's business as usual for licensing in Nottingham
That means more homeless then.
joining us in contributing to building a community where high housing standards are the norm
Joining us? Contributing? You having a laugh, so many Landlords have said your payment page is struggling again & you've not asked me once, Nottingham's biggest Private Provider to Benefit tenants over 26 years, to check if your page is ok to send out to all Landlords.
You a proper disgrace. You are not helping Nottingham vulnerable tenants stay in their home-Have you heard this Homeless section?
We've got dozens of Landlords who can't pay cause your website payment page awful again.
Tenants homes are at stake here.
Who writes these flyers out-The Gestapo? You are preaching without asking. You the Council NEED us & this is where you are getting it wrong.
You should be sending out an email to all landlords apologising for your tone, and telling all Landlords to not try to apply for Licenses yet until you've sorted the payment page out.
I'm sorry, you a disgrace. You've got off on the wrong foot again.
https://www.linkedin.com/feed/update/urn:li:activity:7139666459814715393/