Calls for compulsory licensing for landlords

There have been recent calls for the Government to introduce compulsory licensing for landlords in a bid to clean up the lettings industry.

Property Management Services company Rushbrook & Rathbone believe that landlords should be required to hold a license, and says that they would also welcome a compulsory redress scheme for letting and property management agents.

As part of the redress, tenants will be able to avoid letting agents charging them hidden fees, request longer term tenancies and can hope to expect a better standard of management for their property by landlords. 

“All those in this industry, just like any other, are in it to make profit, they are not doing it for the love of mankind, this is a business and that must be remembered. With that in mind, I agree agents should have a legal obligation to ensure they act responsibly to protect their clients with Client Money Protection and Professional Indemnity insurance. However, what about landlords?” said Rushbrook.

Rushbrook & Rathbone, who have been involved in the property management industry for more than 25 years, have also called for agents to start charging more realistic fees in order to provide higher standards and to ensure compliance with rules and guidelines now enforced on rental properties in the UK. 

According to Rushbrook, running affordability tests and introducing licensing for landlords could protect good and law-abiding landlords and tenants, meaning tenants opting to use unlicensed landlords would be doing so at their own risk. 

Waltham Forest Council said recently that the introduction of compulsory licenses for private landlords will “prevent the exploitation of tenants and improve poor living conditions”.

The Council also hopes to target rogue landlords with closer controls, making life difficult for those who shirk their responsibilities, to increase profits.

However, there are have been fears from the opposition that increased red tape for landlords will lead to them increasing their rents, meaning tenants will be worse off in the long run.

Giles Inman, spokesperson at the East Midlands Property Owners association, said: ‘This scheme will be most damaging in the long run to the very tenants it was designed to safeguard as the increased costs will ultimately fall on the tenants in the form of higher rents. It has the potential to increase homelessness for those on benefits at a time when the city is already experiencing a housing crisis.’

Luke Scott, a tenant from Nottingham, speaking to Inside Housing last month said: ‘My landlord has told us he’s selling up due to the costs additional licensing will bring. He said he’s fed up of being penalised by the city for being a professional landlord.’

It remains to be seen whether the benefits of compulsory licensing will outweigh the increased costs and time spent on administration. But one thing's for sure, the debate will continue to rumble on!

Richard Williams