Rogue Landlords and Letting Agents
The Government states that it will continue to drive up safety and standards in the private rented sector, and drive out the rogue landlords, whom they define as ‘a landlord who knowingly flouts their obligations by renting out unsafe and substandard accommodation to tenants’. As a result, the Housing and Planning Act 2016 has given councils new powers to deal with them.
This Act includes:
- Allowing local authorities to apply for a banning order to prevent a particular landlord/letting agent from continuing to operate where they have committed certain housing offences and so removing them from the sector;
- Creating a national database of rogue landlords/letting agents, which will be maintained by local authorities which was previously announced in 2015 when the (then) Prime Minister David Cameron announced a new licensing scheme to crack down on unscrupulous landlords. We now have a ‘rogue landlord’ database which lists half of all landlord prosecution under the Housing Act 2004 between 2006 and 2014.
- Allowing tenants or local authorities to apply for a rent repayment order where a landlord has committed certain offences (for example continuing to operate while subject to a banning order or ignoring an improvement notice). If successful the tenant (or the authority if the tenant was receiving universal credit) may be repaid up to a maximum of 12 months’ rent.
- Enable local councils to issue fines as well as prosecute.
LEASEHOLD LIFE AND LANDLORD LICENCING
I have always been a supporter of any mechanism that brings so-called ‘rogue landlords’ into the public domain as they always operate under the radar. Its not always placed me on the same page as the views held by the trade bodies but the London Borough of Newham started the ball rolling by requiring all PRS landlords operating in the area to obtain a license. They did this by extending the remit of selective licensing.
Selective licensing an area means it has to be identified as particularly risky. An area can also be designated if it is either one of ‘low housing demand’ or, under s80(6):
- The area is experiencing significant and persistent problems caused by anti-social behaviour;
- Some or all of the private sector landlords who have let premises in the area are failing to take appropriate action to combat the problems;
- When combined with other measures taken in the area by the local housing authority or others with the authority, making an area a designated area will lead to a reduction or the elimination of the problem.
The National Landlords Association raised a number of issues with the action taken by Newham as to whether licensing a whole borough under the selective licensing framework was legal. They also felt it would not make any difference other than to penalise good landlords. They also stated that whilst landlords have limited resources to deal with ASB situations, local authorities do have enough resources at their disposal and should enforce them more vigorously. These resources are:
- ASB Co-ordinators who can make an application to the Court for an Anti-Social Behaviour Order (ASBO) and getting the tenant to sign up to an Acceptable Behaviour Contract (which has all I’ve ever been offered and in only one situation); Envirocrime Units who work in tandem with the police dealing with issues such as fly-tipping, graffitti, dog fouling and abandoned cars;
- Environmental Health Officers: Under s80 of the Environmental Protection Act 1990 (summary proceedings for statutory nuisance) EHO’s will take ‘all reasonable’ steps to assess whether noise constitutes a statutory nuisance. If it does (and is likely to reoccur) a noise abatement notice can be served and if it is ignored then the offenders can face court action as well as the confiscation of the equipment if that is what is causing the problem.
- Premise Closure Orders which are requested by the police and resulting in the courts being able to temporarily close any premises (and common areas) associated with serious and ongoing ASB and/or nuisance.
Now, whilst I didn’t want to get into a debate with the NLA over the legalities of extending selective licensing borough wide, they did kindly publish my views on the topic. The idea of national landlord licensing is however not a new one. The most comprehensive review ever carried out into the state of the PRS in England was in 2008, conducted by Julie Rugg and David Rhodes of York University where national landlord licensing was first suggested.
Commonly referred to as the ‘Rugg Review’ it made particular reference to the need for ‘light touch’ landlord licensing as there were inadequate sanctions available where a landlord was judged to be in serious breach of the regulations. The review suggested that landlords who chose not to respect the regulations should be excluded from the sector and it should not be possible to operate without a permit or a licence.
A low annual fee would provide a landlord number which would appear on all official ‘landlording’ documentation.
All this would also deal with the issue of landlord visibility (or more accurately, the lack of it).
LONDON BOROUGH OF WALTHAM FOREST
My local authority, that of the London Borough of Waltham Forest became a private rented property license area in 2014. Eighteen of the 22- flats on my block are sublet and I let some time elapse before I contacted the council to see how things were progressing. Just before I did so, myself and my partner (RMC Director) received a letter about a particular application. I thought it was the first one because before a license can be issued, the Housing Act 2004 requires all interested parties to be consulted on the proposal.
It subsequently transpired that a number of landlords on my block had applied for licensing before we received any such notification. On querying this, I was advised that the council rely on the applicant filling in the application properly and correctly. Often people miss off these details or supply something completely different. For example, one of our landlord applicants incorrectly stated the freeholder as being the managing agent, along with their corresponding address!
Note: I supplied the correct freeholder address for future reference.
Another landlord was granted a License with no input from us whatsoever which was somewhat annoying. This was a landlord where both the current (and the previous) tenant kept reporting the need for a replacement front door, which was extremely ill-fitting and can easily be forced if anyone has the intent to do so. This leads to not only difficulty with keeping the flat secure but keeping it warm in the winter. I inquired as to whether the licence could be used as leverage in terms of being able to get it reduced to a lesser term if repairs/replacements were not acted upon. I was advised that although it would be the councils decision to make, it would be unlikely that they would reduce the licence to a lesser term for this reason alone although I don’t know if adding any other repair issues would make a difference.
I then started raising further questions on issues which related directly to the circumstances of our particular block of flats.
1: What Happens If Landlords Are Not ‘Fit And Proper’ To Be Granted A License?
I started with asking what happens if any interested parties consider certain landlords not to be ‘fit and proper’ to be granted a license. I was advised that in such cases an ‘intention to refuse’ notice will be issued under s88 of the Housing Act 2004 (grant or refusal of licence). It is possible (within the 14 day consultation period) to nominate someone else to be the licence holder and responsible for the property. If an alternative is not nominated, they will not receive a 5 year licence. The license could be varied if there are concerns about the landlord and they would need valid reasons as to why we did not agree with a license being issued. They could potentially issue licenses of 1 year (instead of 5) in order for these issues to be sorted.
Note: Although there is no legal definition of who is a fit and proper person, the authorities must consider whether the person has been convicted of offences involving fraud, violence, drugs, notifiable sexual offences, the practicing of unlawful discrimination and the contravention of any housing or landlord and tenant law.
2: Who Deals With Anti-Social Behaviour Under Private Sector Leasing?
My second question was where flats are let on council-led schemes such as Private Sector Leasing who deals with issues of anti-social behaviour? The answer was that it will be the agent and the Temporary Accommodation Team who would deal with any such issues. Additionally during their audit and compliance stage they will pick up issues as they go more in depth with their investigations.
3: Can An Unlicensed Landlord Demand A Rent Increase?
Whilst I understood that a tenant could appeal against a rent increase, (which must be put in writing giving one months notice) I wanted to know if a rent increase demand would be viewed as null and void where a landlord is operating without a license. The answer was that whilst such a demand could be made without one, the council suggested it would be less enforceable.
4: What Is The Licensing Time-frame?
I have lost track how long landlords on my block have operated without a license and even those that have applied have yet to be dealt with. So, I tried to get on a fix on the process once the council has received all the information they need. The reply was that they are currently investigating all unlicensed properties that have been reported/found within the borough. In doing so, landlords will receive a warning letter advising them to apply ASAP or be subject to prosecution. They are getting through them but there is an exceedingly high number of unlicensed properties that they are visiting weekly and tackling road by road to try to resolve the issue. Properties will be inspected and landlords warned of their private rented licensing scheme and the urgency of them receiving a licence.
As they also stated, the scheme has now been in place formany months and there are hardly any excuses that are acceptable for properties to stay unlicensed.
Note: This article will be updated as I raise more queries.