Selective Licensing: The Myths, the Truth, and the Subterfuge
At the end of 2024, after everyone knocked off for Christmas, the government ushered in a change to the use of selective licensing for privately rented properties.
This is bad news for landlords, who are already subject to a dizzyingly complex raft of regulations and legislation. It is also bad news for tenants, who are the landlords' only source of income, and it is they who will have to pay for the extra costs.
As the name suggests, selective licensing allows local housing authorities to select specific areas and make them subject to licensing. All they have to do is hold a 12-week ‘consultation’ with no oversight.
Selective licences are an additional requirement to those already required for HMOs and apply to single-family dwellings as well as all HMOs that don’t need any other type of licence.
The changes have extended the housing-related powers of local authorities from 23rd December 2024. At that time, the government gave up having any control whatsoever over the local housing authorities, giving them carte blanche to introduce any selective licensing scheme (including the borough-wide ones the Secretary of State used to stop).
Increasing Demands
Over the coming year, landlords and tenants can expect to see selective licensing coming to their area with onerous demands on the landlords. But no matter how ridiculous some of the selective licensing may seem to some people, failure to comply is a criminal offence with unlimited fines in court or a fine of up to £30,000 if the council issues a civil penalty fine.
The selective licence conditions don’t simply cover housing standards, as one would expect (and the majority of reputable landlords welcome). They make it very clear that landlords are responsible for the behaviour of all residents and their visitors in the area subject to licensing, including anti-social behaviour and even crime. And that’s not just in the property. Many local authorities specify “in the area around the property.” Unfortunately, they don’t all specify whether that’s 5 metres, 50 metres, or 500 metres.
So what does this mean in practice? If an area is experiencing anti-social behaviour, the local authorities can use licence conditions to make the landlord criminally liable and responsible.
An Illustration of How This Can Work
Here’s an illustration of how this might work. Jane, a 50-year-old accountant, inherits the house her parents lived in all their lives. She rents it to Debbie, a single lady with good references.
The local authority introduces selective licensing, and because Jane is savvy, she applies for a licence. The council sends Jane a draft licence containing multiple conditions. Jane reads the licence, but not being a Housing Act specialist, sees nothing troubling and thinks no more of it.
Unknown to Jane, local youths start hanging around the street and see the low garden wall as the perfect place to sit, smoke cannabis, drink alcohol, and throw their discarded cans on the floor whilst playing loud music into the night.
The neighbours start to complain, and the police are repeatedly called. Debbie is too scared to confront the gang, so she tells her landlord, who calls the council to report the anti-social behaviour taking place on the street right outside the property her parents kept pristine for over 50 years.
But rather than sending someone to help Jane and Debbie deal with the gang of youths, the council sends its enforcement officers to inspect Jane’s property. They see the litter piled up outside and speak to angry neighbours. Instead of dealing with the root cause of the problem – the bored young people with nowhere to go – they issue Jane a fixed penalty notice of £15,000 for breaching the terms of her licence.
The Consequences of This Story
Jane is held criminally responsible for actions entirely beyond her control because she was deemed in law to have accepted all the conditions in her licence by default, as she didn’t employ specialists to fight against them in the 14 days the council gave her to do so.
They allege: “She didn’t deal with the anti-social behaviour. She failed to address the noise in the vicinity of her property. She didn’t control the drinking and drug-taking of the young people gathering near her house. She didn’t implement a solution to the constant littering.”
But it gets worse for poor Jane. Any breach of housing regulations is a strict liability criminal offence, and she has to tell her professional body. As a regulated professional, this can mean she loses her job, can’t afford to pay the penalty, and is left with no option but to sell the house. And Debbie loses her home!
The Road to Reinforcement
This is not some dystopian, worst-case scenario vision of authoritarian powers being abused. It’s a regular scenario we’ve dealt with at Landlord Licensing & Defence, fictionalised to protect our clients.
So how did we get here?
Over the last few decades, there’s been a slow creep towards prioritising the collection of revenue instead of dealing with the issues at hand.
The Road Traffic Regulation Act 1984 gave local authorities the power to control parking and fine drivers who breached the rules.
In 2004, the Traffic Management Act extended those local authority powers to cover moving vehicles, allowing local authorities to collect the penalties imposed for speeding.
Now, the focus has turned to the private renting sector.
Landlords come in for a lot of criticism – some of it justified, most of it not. Most landlords are ordinary people who are simply trying to make an honest living by providing decent housing.
People like ‘Jane’ are being held responsible for upholding standards in communities when they have no powers or authority to do so. Not the perpetrators, not their parents, not the police.
The Answer? Education, Not Enforcement
It’s a very bleak picture, and the Renters Rights Bill currently making its way through Parliament doesn’t offer any light at the end of the tunnel.
The Bill strengthens local authority enforcement by expanding civil penalties from a maximum of £30,000 to £40,000 per breach and introducing a package of investigatory powers and myriad new things that they can fine landlords for.
The country is experiencing a housing crisis. Handing more enforcement powers to local authorities won’t solve this, and it won’t help renters.
We need a solid framework of education and improvement, much like the car MOT system and speeding awareness education for drivers. Annual or bi-annual inspections carried out by properly trained, independent assessors whose priority is ensuring standards, either bringing properties up to scratch or taking them out of use.
If we can take dangerous housing off the market in the same way we keep deadly cars off the road, we can improve and expand the housing stock available for those who so desperately need it.
Oh, and a selective licence will cost, on average, £1,000 for 3-5 years. Jersey does it for £30/year, and they run a much more effective scheme.
If you have any queries about selective licensing or are in a situation where you need some pointers, please don’t hesitate to contact us for a discreet conversation on how we can help.
Telephone: 0208 088 8393Website: landlordsdefence.co.uk
