Landlords with property in Newcastle are being encouraged to have their say in a licensing consultation which is being run by Newcastle City Council on plans to introduce a licensing scheme that will affect more than 18,500 properties.
In the RLA’s response to this consultation, which you can read here, we have opposed the scheme and have raised a number of our concerns with it, ranging from an unlawful licensing condition, high cost of obtaining a licence and the fact that the council is offering no discounts for accredited landlords.
This consultation closes on Sunday 27th January, and landlords can have their say here.
What Newcastle City Council is proposing
Newcastle City Council is proposing to introduce a new private rented property licensing scheme, which would last for five years. The scheme will use a combination of both selective and additional licensing.
The proposed selective licensing scheme
Newcastle City Council is proposing to licence over 20% of the private rented sector, through a combination of self designation and Secretary of State approval to introduce selective licensing.
The council is proposing to self designate some areas, which it estimated will bring around 4250 properties into the scope of selective licensing. In addition to this, the Council plans on seeking Secretary of State approval to designate others areas, which would be a further 4,850 properties into the scope of this .
What is Selective Licensing?
In areas where selective licensing is in place, landlords must apply for a licence in order to rent out a property. For a local authority to declare a selective licensing area the area must be:
- An area of low housing demand and/or
- An area affected by anti-social behaviour where the private landlords have failed to take steps to control anti-social behaviour by their tenants.
There are currently two selective licensing schemes running in Newcastle, in the areas of Greater High Cross and Byker Old Town.
These two schemes have been operating for over five years and the council says these schemes will still be active when the proposed licensing scheme starts. The Council intends to passport the current licence holders onto the new scheme granting a 5-year licence at no additional cost.
High licence fees that will lead to increased rents
The RLA has raised concern about the £650 licence that landlords would be expected to pay for should the scheme get the go ahead.
In our response we argue that this fee does nothing to address affordability, and that landlords will only end up passing this cost on to tenants in the form of increased rents. Added to which-criminal landlords will simply ignore the scheme, as they do other regulations.
No discounts for accreditation
Added to this, Newcastle City Council is not offering any discounts for landlords for either the selective or additional licensing schemes. The RLA says that if this scheme were to go ahead, landlords who are accredited )for example with the RLA) should be able to receive a discount on their licence fees.
Unlawful selective licensing condition
Newcastle Council is proposing that one of the conditions of the licence is that the local authority would be able to demand a Periodic Electrical Report, if there are reasonable ground for believing the electrical installation may need repair or upgrading. The condition states:
“If the Authority has reasonable grounds for believing the electrical installation may need repair or upgrading it may demand a Periodic Electrical Report carried out by a suitably qualified electrical contractor who must be registered/member of an approved body such as NICEIC, NAPIT, etc. or registered to undertake electrical works in accordance with Part P of the Building Regulations. This report must be no more than 5 years old and deem the electrical installation to be in at least a satisfactory condition”.
The RLA considers this condition to be unlawful, as it breaches the precedent set in Brown v Hyndburn Council, and we are calling for the council to remove this condition should the scheme go ahead. You can read more about this in detail in our formal response.
Considering the results of the HHSRS and selective licensing Government reviews
In our response to the Council, we also recommend that the Council awaits the result of both the Government’s review into HHSRS and Selective Licensing, before proceeding with this scheme.
The proposed additional licensing scheme
As well as implementing a selective licensing scheme in Newcastle, the Council is also planning on implementing an additional licensing scheme throughout the city, which it estimates will affect 9350 properties.
Additional HMO licensing applies to Houses of Multiple Occupation which are not subject to mandatory HMO licensing but which are of a description designated for HMO licensing by the local authority.
The new proposed Additional Licensing scheme in Newcastle will require all Houses of Multiple Occupation (HMOs) occupied by three or more people not living as a same household to be licensed.
RLA objections to the additional licensing fee structure
The proposed licence fee is £750, which the RLA objects to because, as with the selective licensing scheme, this will do nothing to address affordability and could again lead to increased rents, with landlords left with no choice but to pass the cost on to tenants.
In our consultation response we also outline why we are opposed to the fee structure which is being proposed by Newcastle City Council. Specifically, we believe that the fee structure has not taken in two parts as Gaskin states it should be, and this should be immediately amended to reflect current case law, if the scheme is approved.
Have your say
This consultation, which has been running for twelve weeks, closed very soon on 27th January 2019. If you are a landlord in Newcastle, we are urging you to have your say on these licensing proposals. You can have your say here.
You can also read more about the proposal in full on the Council’s website here and see the areas on a map where the proposed schemes will affect.