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Can selective licensing help clean up communities?

Tuesday 27 February 2018

By Carl Agar

Selective licensing initiatives are increasing as more and more councils seek to ‘clean up’ areas suffering from high levels of anti social behaviour, currently blighting towns, villages and cities across the UK. 

Often these areas tend to have been places formerly bustling with colourful communities in the past - where families would occupy rows of purpose-built terraced housing and seek employment at the nearby pit, dock or steel works. But as manufacturing has declined, so too have our communities. The result was that many people who lived in these areas migrated away in the search of work, and the local employers and generations of families which stitched together these communities gradually disappeared.

Following the introduction of the AST in the 1990s and the reduction in social housing provision over the last 15 years, these areas have provided a very attractive investment proposition – with low value properties with high rental returns and plenty of demand. 

Private rented housing estates

Private landlords have snapped up these properties, and by doing so have inadvertently created large scale private rented housing estates. 

By their very nature, shorter-term tenants will not typically care for the property or get involved with the surrounding community. They simply aren’t invested – and they tend to live in silos. 

Often, the areas involved end up packed with housing benefit tenants in need of additional support that they would normally have received from social housing providers, and which cannot really be replicated by individual landlords. Such tenants can often be ‘difficult to house’ - and come with their own personal problems such as drug use, alcoholism, anger issues or health difficulties. Obviously, these problems can result in anti-social behaviour, including theft, vandalism and waste management issues. 

As a result more of the original tenants move out and the ones that stay become too frightened and anxious to go outdoors. As things persist, low demand for housing in such areas increases, and before we know it the entire area is in disarray. 

What is the solution?

One thing I can say for sure is that there is no one solution that can solve such complex problems - and that without doubt a co-ordinated effort from a number of different parties will be required. This will involve the police, social services, the Local Authority, landlords and residents all working together. 

In an attempt to try and address their responsibilities, Local Authorities all around the country have been reaching for a tool known as ‘selective licensing’ - which enables them to designate a specific geographical area in their towns or cities and demand that all private landlords have a licence in order to let out their properties. 

The licence often comes with a hefty price tag, is loaded with lots of conditions - and it’s a criminal offence not to have one. The theory behind this approach is that if private landlords improve property standards and management standards then issues surrounding rental properties will dissipate. 

Changing behaviour

In practice, this approach does yield results in raising property standards - but we very rarely see a sustained change in landlord or tenant behaviour. 

The problem being that they are attempting to change behaviour through enforcement and not through addressing the educational and developmental needs of everyone involved - the landlords, the tenants and the wider community. 

Implementing a selective licence scheme can only ever be the start of addressing issues in a problem area, and it should be used strategically alongside other initiatives to ensure real change takes places and stays in place. 
But most of all it needs to involve all stakeholders in the community. 

If it does, it CAN work. And I’ve seen it working well.

I believe Doncaster Council and West Lindsey District Council are pioneering this approach – and it gives me hope for the future for both the private rented sector - and more importantly for the communities we’re now a part of. 

 

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Article by:

Carl Agar

Carl Agar

Carl Agar is the managing Director of Big Red House letting agents, founder and Chief Executive of The Home Safe Scheme, has been the Yorkshire representative of the National Landlords Association for the last decade - the UK’s largest landlord association, as well as being a Landlord and Investor.