A borough-wide licensing scheme that has been proposed in Islington could lead to rent increases if it is introduced, the RLA has warned.

Islington Council is proposing to introduce a borough-wide additional HMO licensing scheme, and a selective licensing scheme to cover all properties in the Finsbury Park ward not already covered by mandatory licensing.

If the plans are approved, landlords who have in the designated areas would be required to obtain a licence in order to rent out their property lawfully.

The RLA’s response to the plans

In the RLA’s response to a consultation on the plans, the association has warned that criminal landlords would simply ignore the scheme, as they do other regulations. You can read the RLA’s main concerns below.

Rent rises likely if the scheme is introduced

The association has also warned that because landlords will have to apply for licences under the scheme, they are likely to pass the cost of this on to their tenants in the form of rent increases.

In August 2018 a borough-wide selective licensing scheme was introduced in Nottingham, and it has been reported recently that the city has seen the highest percentage rise in rent compared to anywhere else in the country, since this scheme was introduced.

The Council already has existing powers to tackle criminal landlords

Islington Council says that it wants to introduce the additional and selective licensing schemes to:
• Improve the condition and safety of privately rented properties
• Make it easier to identify and take targeted action against bad landlords
• Provide a level playing field for good landlords who treat their tenants fairly

However, in the RLA’s response to the consultation, the association has pointed out that the Council already has enforcement powers under the Housing and Planning Act 2016 and the Housing Act 2004, including civil penalties and banning orders.

Rather than introducing a licensing scheme, the Council should instead make better use of the powers that are already available to them in order to tackle the issues highlighted above.

Little evidence to show licensing schemes raise standards

The RLA is also concerned that there is little evidence to show that licensing schemes are effective in improving housing standards. This is because the focus of staff becomes the processing of licensing applications and whether a property is licensed or not, rather than improving management standards and property conditions.

• A consultation on this scheme closes on 3rd November. You can read more about the proposals here, and read the RLA’s response in full here.
• The RLA has guidance for landlords on additional licensing and selective licensing, which members can read online.
• Keep update with the latest licensing news here

Written by Victoria Barker

Blog Post from Residential Landlords Association

See details of our Guaranteed Rent Scheme here