East Midlands Property Owners (EMPO) is the leading regional landlord association representing and supporting landlords across the East Midlands. We provide landlords, letting agents and property investors with the advice, knowledge and tools necessary to be more professional in terms of landlord and housing management.
EMPO is frustrated and disappointed with the lack of any invitation for early or mid term consultation by Nottingham City Council (NCC) with regards to this proposal. We are scathing in our view on why NCC is not able to enforce standards within existing legislative frameworks. Rather than imposing upon the large majority of good landlord’s costly additional obligations. It will be the case under this proposal that good landlords end up effectively paying for the problems that have been caused by the non-compliant landlords, on whom we think it is more appropriate to concentrate.
What we find absolutely baffling about this proposal to regulate smaller HMOs is that the overall HMO numbers are in decline, particularly the largest segment in the city; student HMOs. This decline is being fueled and encouraged by the councils much lauded approach to the development ofcity centre purpose built student blocks. There are already 45 blocks operating in Nottingham with at least another 15 in development. Presently there are 4500 bed spaces available with at least another 1500 coming online by 2014/15. With this all going on one has to ask the question “Why is the council proposing to implement a costly and widespread regulation within a declining HMO housing sector. When public money could otherwise be better spent on real priorities such as closing down criminal landlords and or policing the problems that will arise from the shift of population into the city?”
EMPO believes additional licensing will not have the ability to make non-compliant landlords comply. The assumption those landlords who, in the past, have shown no willingness to comply with current regulations directed at gas, electrical and anti social behaviour (ASB) are then going to comply with any additional regulations is sheer fantasy.
.Non compliant landlords are criminal landlords. The armory of legislation already in place is broadly criminal legislation, and therefore should be actively utilized and enforced by NCC against these criminal landlords.
We have seen how a lack of enforcement activity under Article 4 legislation introduced into Nottingham in March 2012 is allowing landlords to operate illegally and therefore making a nonsense of the legislation.
There are a growing number of local authorities – such as Bournemouth, Manchester, Leeds and Westminster who are rejecting licensing in favour of progressing with local landlord accreditation schemes. These schemes allow landlords to self-regulate and local authorities to concentrate their efforts on tackling criminal landlords. This is a position supported by EMPO, which has long argued that local authorities have enough powers todeal with issues relating to the private rented sector, and that licensing is another layer of bureaucracy that simply will not work.
NCC Executive Board Document – 18th December 2012
The claims in this document that additional licensing will provide the following benefits:
- an opportunity to effectively influence higher standards of HMO accommodation and to ensure effective management through more extensive control;
- and lead to higher levels of customer satisfaction with private rented sector accommodation within the city.
This is simply not true. There is very little evidence, if any at all, confirming since the introduction of mandatory licensing there has been higher standards or an improvement in the management of HMOs. On the contrary, there are still large numbers of 5 bed HMOs in the city that have not been licensed. Those that have been licensed under the mandatory licensing scheme continue to present problems in relation to the standard and management of those properties as clearly illustrated in the council own complaints database.
No evidence has been submitted supporting the claimthat licensing will lead to or has lead to greater customer satisfaction in the PRS. As the voice for landlords in Nottingham EMPO are aware large numbers of tenants, even those that live in mandatory licensable properties, have no knowledge that licensing even exists. In our view licensing has not given the council any greater powers above those that exist already in housing legislation.
The council cites in this document ASB is a major driver for introducing additional licensing across Nottingham. While providing little specific or robust evidence through their much lauded flare complaints databasethis problem is actually an issue within non-mandatory HMOs. In fact during thelast 18 months the council has featured regular articles in the Nottingham Arrow publication stating a decline in ASB and crime in Nottingham. We remind the council the complaints data provided as part of this consultation is required to address the key precondition laid down in the Housing Act 2004, namely linking perceived problems with HMOs that are not subject to mandatory licensing.
Sadly ASB is a growing UK wide societal problem arising from people failing to take ownership of their responsibilities in terms of integrating, respecting others and taking pride in their communities. We strongly believe the council is trying to use additional licensing as a fix to cure all of society’s problems.
We remind the council that matters raised in the document concerning the poor condition and disrepair of HMOs, have to be addressed via the Housing Health & Safety Rating System (HHSRS). The Housing Act 2004 stipulates that generally license conditions should not be relied on where the use of HHSRS powers can be enforced. If there are issues regarding unsightly appearance they can be addressed by notices served under section 215 of the Town and Country Planning Act.
We must remind the council that issues around waste and refuse in the vicinity of HMOs is something that can be dealt with by other powers and perhaps by a common sense approach such as an improved council refuse service especially when students come and go at the beginning and end of the academic year. A recent claim by a spokesman from NCC stating Nottingham was the cleanest city in the UK begs the question why this is an issue being relied upon to introduce an additional licensing scheme.
We remind the council that issues around noise complaints can be dealt with under the Environmental Protection Act 1990 and the Regulation of Noise Act 1996. Nuisance law is criminal law, and appropriate measures including prosecution of the offender can be taken in the last resort to prevent the nuisance from re-occurring.
In fact since mandatory licensing was introduced in2006, no review or report has been commissioned by NCC to illustrate the effectiveness or impact of the scheme. Despite Communities and Local Government (CLG) guidelines on additional licensing, that a review of the existing mandatory licensing scheme must be done before additional licensing is introduced.
NCC Proposal for Additional Licensing Document 25 February to May 20th2013
There is no relevant evidence put forward to support the proposal; with the statistics quoted in the consultation being “irrelevant” “spurious” and “misleading.” The examples relating to the number of gas and electrical safety checks do not include the overall numbers of HMOs involved; therefore making them meaningless as statistically some landlords will bring forward inspections to ensure re-inspection does not occur. The examples relating to category 1 and 2 hazards are equally meaningless as there is no detail on the total number of landlords and HMOs these hazards relate to. Other key elements of the proposal such as the financial model are lacking in detail and fail to achieve value for money for the tax payer.
The proposal does not contain any measurable aims or objectives or a clear exit strategy once the licensing scheme lapses in five years. Providing a simplistic questionnaire as part of the consultation is outrageous and does not represent a serious attempt to consult with stakeholders in this debate. Proper consultation means the whole aspect for the reasons for considering additional licensing should be broken down to examine the real issues impacting communities. As well as the individual areas to which the scheme isto be applied. Only then can justification be given to the validity of additional licensing as a definite tool to solve these issues.
Guidance provided by CLG stipulate that robust evidence needs to be gathered to prove the need for a scheme and extensive consultation is needed to seek the views of residents and landlords in the proposed areas. The promotion of this proposal has been a total travesty consisting of a narrow campaign of marketing awareness through the council website, a random resident leaflet drop and an advert in the University Newspaper. Apparently there has been no advertising coverage in the main local newspaper The Nottingham Evening Post due to a long standing dispute between the council and the Nottingham Evening Post.
Furthermore guidance stipulates the council needs to demonstrate that they have tried other strategies to address the problems around smaller HMOs and again there has been a failure to provide detailed information concerning this point within the consultation document or any document issued around the proposal.
The implications of this proposal on landlords with properties within these areas are immense. Notwithstanding the cost of applying for the license, any inspection undertaken may result in an enforcement order to alter the property which could run into thousands of pounds and be totally irrelevant to the 'type' of households actually living there.
The cost burden associated with this proposal will be passed onto tenants in the form of higher rents. Adding to the huge financial hardship many tenants are already experiencing due to welfare reform and increases in household living expenses. Contrary to the NCC claim that this proposal will enable it to achieve its goals in terms of housing the homeless. Landlords who would normally consider housing benefit, unemployed and homeless people in HMO style accommodation will no longer consider this as an option, simply because the risks of rent arrears and ASB associated with them will make such tenants commercially too risky under this proposal.
This proposal will significantly impact the ability and appetite for investors to consider Nottingham as being an option for providing rental housing. There is a huge fear amongst landlords that the continued roll out of regulation and interference by NCC will make housing investment in the city an unattractive option.
Furthermore this proposal will do nothing to improve communities and in fact have the opposite affect as these areas will be regarded as bad areas. Where families chose not to purchase property, property investors do not invest and mortgage lenders such as Lloyds and RBS do not lend. If other lenders follow the route taken by Lloyds and RBS we will see more sellers struggling to sell properties therefore further negatively impacting sellers and areas already blighted by Article 4 regulations.
EMPO, believes due process has not been followed and if the scheme is adopted we will seriously consider subjecting it to a legal challenge. The fact that this scheme will capture a widespread area of Nottingham is of particular concern. Particularly when by the councils own admission they are failing with administration such as processing licensing applications and conducting inspections in a timely fashion under mandatory licensing.
Year after year we have been informed that both UNIPOL and DASH have had huge positive impacts on housing and in fact last years Nottingham Housing Plan document applauds the success of the accreditation schemes covering Nottingham. Under this proposal the council is now saying these accreditation schemes have not been effective in stemming HMO complaints.
We believe the level of and the way the problems have been presented in the proposal do not in any way justify the imposition of additional HMO licensing. The resulting bureaucratic procedures and costs would be totally disproportionate to the kind of issues highlighted.
The principle that NCC should adopt is to encourage landlords into accreditation schemes, and target those that remain outside. Rather than focusing on a scheme that would capture good landlords while allowing criminal landlords to continue operating with impunity. This approach would increase the willingness 6for EMPO and Nottingham landlords to engage.Therefore we ask the council to immediately reconsider its proposal, leaving the route clear for the majority of Nottingham’s good landlords to productively work with the council in supporting workable measures such as the Nottingham Standard to improve standards across the private rental sector.
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