Newham council and the Welsh Government should be commended for tackling rogue landlords but ill-conceived policies will hinder, not help.
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The announcement last month that Newham council will introduce the first borough-wide licensing scheme for private landlords was met – quite rightly – with mixed reactions from lettings staff.
The issue of rogue landlords is not a new phenomenon and it is vital that local authorities such as Newham, and on a national level the Welsh Government which proposes a similar scheme, act to tackle it. But I believe that solution will not be found through new regulation. What renters need to see is better enforcement of existing rules and laws.
Though Wales is yet to put flesh the bones of its proposed regulatory programme, Newham’s licensing scheme is a blanket approach that will smother the local housing market.
The scheme, which will cover 35,000 private tenancies in the borough, aims to reduce the letting of sub-standard rental accommodation and remove rogue landlords from the lettings market. By making sure that every private landlord in the borough has a licence, Newham hopes to make it impossible for rogue landlords to operate in the area without making their property available for inspection by council officers.
But though the council should be commended for its proactive attitude, the proposal is deeply flawed. Bad landlords make up an incredibly small percentage of the private rented sector, and to lumber every landlord with another tiresome piece of bureaucracy will damage relations and increase the barriers to entry for potential future landlords in an area of high housing demand.
How will the scheme be financed? Attempting to inspect 35,000 properties is a costly administrative undertaking; an underfunded, ill-conceived scheme will fail in its purpose and simply drive rogue landlords further underground.
So is there a better solution? I would like to see a consolidated approach to regulation, funded by central government and overseen by a trusted industry body such as the Royal Institution of Chartered Surveyors, the Association of Residential Letting Agents or the National Association of Estate Agents. These bodies understand that in order to maintain a buoyant private rented sector – vital in helping reduce the national housing deficit – we need a lighter touch that will encourage and nurture private landlords.
They also have the ability to broaden existing regulations, such as the tenant deposit scheme, to incorporate new measures to prevent rogue operators entering the market. One possibility could be to require every landlord to provide some form of certificate of approval with their tenancy deposit scheme certificate – a measure implemented without great cost to the landlord. Education and awareness also play a major role, and industry bodies are also best placed to inform tenants about the risks involved when renting a property from an untrustworthy source.
The bottom line is that decent private rented accomodation is an issue bigger than the London borough of Newham, bigger even than Wales. In order for us to wipe out bad landlords local authorities, national policy makers, industry bodies and housing professionals need to work together to create new policies that will tackle the issue without punishing responsible landlords.
If this doesn’t happen, and other authorities decide to implement the same ill-fated scheme as Newham, we run the risk of permanently damaging the private rented sector – an important prospect for national growth.
Robert Nichols is director of the London-based lettings agency Edmund Cude.
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