|
Subject:
|
Private Sector Housing:
Discretionary Licensing Evidence
|
|
Date of Meeting:
|
15 March 2023
|
|
Report of:
|
Executive Director
Housing, Neighbourhoods & Communities
|
|
Contact Officer:
|
Name:
|
Diane Hughes
|
|
|
|
Email:
|
Diane.hughes@brighton-hove.gov.uk
|
|
Ward(s)
affected:
|
All
|
FOR GENERAL
RELEASE
1. PURPOSE OF
REPORT AND POLICY CONTEXT
1.1
The significant growth in private rented
sector housing in Brighton & Hove remains a key theme for the
city with just under one in three households in the city renting
privately. While many landlords operate responsibly, there
are concerns that a some do not. As a result issues are raised in
relation to the management, standards and quality of homes in this
expanding sector. Improving the quality and management of homes in
the private rented sector over the period 2019-2023 has been a key
area of focus in the Housing Committee Work Plan.
1.2
On 28 September 2022 Housing Committee was notified that
consultants had been appointed and commenced the selective
licensing feasibility study in September 2022.
1.3
Subsequently, this independent research has concluded that there is
sufficient evidence to demonstrate a significant proportion of
Houses in Multiple Occupation (HMO) are being managed sufficiently
ineffectively to support the introduction of citywide Additional
HMO licensing to smaller HMO’s. It also demonstrated
support for the introduction of Selective Licensing. Options
for this were considered (please see 3.31 of the report) and the
preferred option (Option 3) is to introduce a selective licensing
designation in four wards in the city on the grounds of poor
property conditions and deprivation with a further designation
option in 13 wards on the grounds of poor property conditions.
1.4
This report:
·
presents the findings of independent research commissioned to seek
evidence that would support, or reject, the need to implement a
further discretionary licensing scheme across the whole, or
part(s), of the private rented sector in Brighton & Hove
·
reviews the existing Brighton & Hove Additional HMO licensing
scheme
·
seeks Member approval to carry out formal consultation on the
preferred option for extending licensing across Brighton &
Hove.
2.
RECOMMENDATIONS
2.1
That Housing Committee notes the findings
of the Private Sector Housing: Housing Stock Condition &
Stressors Report that evidences the need for a citywide approach to
discretionary licensing (Appendix 1).
2.2
That Housing Committee approves Option 3
(see 3.31), which will be subject to 12 weeks of consultation (to
commence once a revised fee structure is agreed by Members) .
This is:
(1) Citywide Additional HMO Licensing covering properties
which have two or more storeys and three or more tenants are living
there as more than one household.
(2) Selective Licensing on all non-HMO private rented
sector homes in four wards where the evidence demonstrates a clear
link between poor property conditions, deprivation and private
rented homes. These wards
are: Kemptown, Moulsecoomb &
Bevendean, Queen’s Park and Whitehawk &
Marina.
With a further option in 13 wards in the city on the grounds of
poor property conditions. These wards are: Brunswick &
Adelaide, Central Hove, Goldsmid, Hanover & Elm Grove,
Hollingdean & Fiveways, Preston Park, Regency, Rottingdean
& West Saltdean, Round Hill, South Portslade, West Hill &
North Laine, Westbourne & Poets Corner and Wish.
2.3
That Housing Committee notes that the
Budget Review Group has provided £100,000 to fund
non-recoverable costs (such as consultation) needed in developing a
scheme and that budget council has allocated a further
£20,000.
2.4
That Housing Committee requests the
findings of the consultation and appropriate recommendations be
brought back to a future committee for Member decision.
3.
CONTEXT/ BACKGROUND INFORMATION
3.1
A key theme of the city’s housing
has been the significant growth in private rented housing in
Brighton & Hove. In 2021, the Census reported that the Private
Rented Sector stood at 39,937 homes, 32.9% of all housing stock in
the city and the 11th largest in England and Wales
outside of London.
3.2
The sector increased by 1.9%, between
2011 and 2021. Three wards have half or more than half of
households in homes rented through private landlords or lettings
agents.
3.3
17 of the new 23 wards due to come into
effect in May 2023 exceed the national average of 20.3%
of households living in private rented homes (figure 1). This
means that six wards in the city can not be considered for a
selective licensing scheme as they fall short of the required
threshold of being above the national average.
3.4
The growth in the sector brings the benefits of a flexible housing
market response to meet accommodation needs in the city. However,
while many landlords operate responsibly, issues continue to be
raised in relation to the management, standards and quality of
homes in the expanding private rented sector.
Figure 1 - Percentage of private rented sector
by ward
3.5
The 2004 Housing Act introduced mandatory licensing of larger HMOs
and contained provisions for further ‘discretionary
licensing’. HMOs are defined as properties with three or more
occupiers who form two or more households and who share a kitchen,
bathroom or toilet. This does not include live-in landlords with 2
or fewer lodgers (unless that dwelling is itself within an HMO).
Certain HMOs are exempt from licensing under Schedule 14 of the
Act, such as those managed by local authorities, registered
providers and educational establishments.
3.6
HMOs with five or more occupiers consisting of two or more
households are subject to mandatory licensing, and all such HMOs in
England and Wales must be licensed.
3.7
There are two types of discretionary licensing for private rented
sector homes:
(a) Additional:
where a council can impose a licence on other HMOs in its area
which the council considers that poor management and standards of
the properties is causing problems either for the occupants or the
general public.
(b) Selective:
covering all privately rented property in areas which are
experiencing one or more of the following conditions,:
·
low housing demand
·
significant and persistent anti-social behaviour
·
poor property conditions
·
high levels of migration
·
deprivation
·
crime
Local authorities must obtain express confirmation
from the Secretary of State for any selective scheme(s) which cover
more than 20% of their geographical area or affect more than 20% of
their private rented sector.
3.8
Under licensing, landlords have to:
·
Meet appropriate and professional standards of conduct;
·
Demonstrate their properties meet health and safety standards
including fire and electrical safety;
·
Exercise appropriate management and supervision of the buildings to
help reduce any adverse impact on neighbourhood
3.9
The different licensing schemes bring
different responsibilities and requirements on the landlords and
council:
|
Licensing scheme
differences
|
Mandatory HMO
|
Additional
HMO
|
Selective
|
|
Property Type
|
Larger
HMOs
(2 or more
households, and 5 or more people)
|
Smaller
HMOs
(2 or more
households, 3 or more occupiers, share kitchen, bathroom or
toilet)
|
All other
private rented homes
|
|
Scheme Duration
|
Ongoing (but
5-year licences)
|
5 years
max
|
5 years
max
|
|
Fit and proper person test
|
Yes
|
Yes
|
Yes
|
|
Property inspection
|
Yes
|
Yes
|
Risk based (but
not statutory)
|
|
Conditions can be attached to require upgrades
to heating, fire safety etc
|
Yes
|
Yes
|
No
|
|
Can specify no of occupiers
|
Yes
|
Yes
|
Yes
|
|
Consultation requirements
|
None
|
Must consult
all likely to be affected for 10 weeks minimum
|
At least 10
weeks
|
|
Designation criteria
|
None
|
Ineffective HMO
management and standards
|
Low demand,
migration, deprivation, poor quality, anti-social behaviour,
crime
|
|
Secretary of State confirmation
needed
|
No (legislative
requirement)
|
Done via
general consent if guidance followed
|
Yes, if scheme
exceeds 20% of area or 20% of PRS stock
|
3.10
Councils are able to recover their costs
associated with the administration of licensing schemes through
licensing fees. Landlords who operate a designated property
without a licence may be subject to criminal prosecution, unlimited
fines and/or a rent repayment
order.
3.11
Concerns about the impact of HMOs on
tenants and communities led to the introduction of Additional
Licensing of smaller HMOs within the city. The first scheme
launched in 2012 covering 5 wards near to the Lewes Road area of
Brighton and a second scheme launched in 2015 covering 7 city
centre and coastal wards. A third scheme covering all
wards within Brighton & Hove launched in 2018 and expired on 28
February 2023.
3.12
A number of properties within the third
scheme still require reinspecting to check that the special
conditions have been compiled with. The Private Sector
Housing Team are able to complete these visits within six months of
the current scheme expiring and will set up a programme of visits
in order to achieve this.
3.13
Evidence from the latest Additional Licensing of HMOs in Brighton
& Hove has highlighted that in over 8 in 10 (82%) current
cases,
the properties required improvements to ensure they are fit and
safe for occupation. Whilst these improvements are benefitting an
estimated 5,500 tenants, the city’s licensing only covers 10%
of the private rented sector.
3.14
The benefits of discretionary licensing
include development of a proactive and consistent council-led
approach towards identifying, and tackling complex issues of
management, standards and anti-social behaviour across the area to
the benefit of tenants, responsible landlords and the local
community:
·
Responsible landlords will gain from the improved clarity of
their role in raising property and tenancy management standards
while action is taken to tackle those who flout their legal
responsibilities. Licensing has encouraged a positive
interaction with landlords and allowed for any problems presented
by each property to be managed on an individual basis.
·
Tenants will be clear on what they can expect from both the
home that they rent and the landlord that they rent it from, with
implementation of minimum standards resulting in better managed,
quality and safer homes. Any repairs and improvements will be
required by the council rather than a tenant complaining and
subsequently fearing loss of their tenancy, taking tension out of
the landlord and tenant relationship.
·
Communities benefit from a consistent approach to HMO’s
whereby housing conditions are being proactively assessed and
improved across an area. Communities also know who is
responsible for the management of properties that are rented
out.
3.15
Any designation made by a local housing authority for discretionary
licensing must ensure that the exercise of the power is consistent
with their overall housing strategy; and seek to adopt a
co-ordinated approach in connection with dealing with homelessness,
empty properties and anti-social behaviour affecting the private
rented sector as regards combining licensing with other action
taken by them or others.
3.16
The Council Plan 2020-23 has housing as a key objective ‘A
city to call home’. Within this there is a focus on
improving access to good quality housing, improving private rented
housing and making better use of existing housing capacity. The
Housing Committee work plan 2019-23 further embeds this commitment
with a range of actions related to improving private rented
housing.
3.17
The Homelessness and Rough Sleeping Strategy 2020-25 identifies
that homelessness from the private rented sector is consistently
the single biggest cause of homelessness in the city. Improving the
standards of accommodation and management in the private rented
sector is seen as one of a number of tools to help reduce
homelessness from this sector.
The case for
extending discretionary licensing
3.18
Cadence Innova working with Metastreet, were appointed to
independently research and report on the evidence that would
support, or reject, the need to implement a further discretionary
licensing scheme across the whole, or part(s), of the private
rented sector in Brighton & Hove. A copy of
Cadence’s feasibility review is available on the
councils’ website. The Housing Stock Condition and
Stressors Report outlining the evidence is attached as Appendix 1
with the main points summarised below.
3.19
In analysing the evidence, it is important to link incidents of
disrepair and other evidence with privately rented homes. Without
this connection, whilst there may be evidence of problems in an
area with a large private rented sector, it is not possible to say
whether these are linked to those homes or other owner occupied or
social rented homes. However, there is no database that identifies
which homes are privately rented.
3.20
Cadence were selected to carry out the research as with Metastreet
they presented a unique methodology to predict which properties are
most likely to be private rented dwellings. Metastreet’s
Tenure Intelligence (Ti) methodology
Ti uses big data
and machine learning in combination with expert housing knowledge
to accurately predict a defined outcome at the property level.
3.21
This methodology used a combination of indicators after discounting
social housing to determine the likely number of privately rented
homes in the city. The resultant property list then allowed
them to analyse address level incidents to determine whether
privately rented homes were more or less likely than other tenured
housing to be associated with these problems. Their report outlines
this methodology in more detail at Appendix 1.
3.22
Of the criteria that may demonstrate a need for selective
licensing, a number were discounted as they do not apply in
Brighton & Hove sufficiently or there are insufficient means to
link them to the private rented sector:
·
low housing demand
·
high levels of migration
·
crime
3.23
The Metastreet research focussed on poor property conditions,
significant and persistent anti-social behaviour (ASB) and
deprivation, analysing a number of data sources. These
included
·
Council ASB including noise complaints
·
Requests for Assistance (RFAs) to the council’s Private
Sector Housing Team regarding property disrepair
·
Licensing data
·
Prosecutions and fines
·
Energy Performance Certificates data
·
Tenancy deposit schemes
·
Indices of Multiple Deprivation
3.24
On analysing the data, the evidence shows that:
·
Data from Indices of Multiple Deprivation confirm that 4 of the new
wards within the city are in the 30% most deprived wards in the
country (figure 2).
·
There is predicted high levels of poor property conditions within
HMO’s and the wider private rented sector (figure 3 and
4)
·
There was not sufficient evidence to link ASB to HMO’s and
the private rented sector.
3.25
In addition, a review of the existing citywide Additional HMO
Licensing Scheme has taken place. This five-year
scheme was introduced in 2018 and applied to smaller
HMO’s. As of 7 February 2023, the council had received
1,913 applications of which 9 were at application stage, 38 at
draft licence scheme and 1,866 at full licence stage.
3.26
In addition to the mandatory conditions that all landlords of
licensed HMO properties must adhere to, housing quality issues
identified during property inspections have led to 3,759 special
conditions being attached to licences.
This has resulted in improvements in 1,571 homes, benefitting an
estimated 5,500 tenants. Under the previous two Additional
Licensing Schemes 10,800 special conditions were applied.
This difference in volume is representative of the level of
improvements that were made through the initial schemes. This
demonstrates the impact that licensing can have when the council is
able to take a proactive approach.
|
Special
Conditions
|
Additional HMO Licensing
|
|
Total special conditions
applied
|
3,759
|
|
Licensed properties
with
special conditions
applied
|
1,571
|
|
Percent of Fully
Licensed Properties with Special conditions
|
82%
|
|
Estimated number of
tenants benefitting (at 5 per HMO)
|
5,500
|
·
As of 7 February
2023
3.27
The conditions applied cover a range of housing quality issues.
|
Special Conditions
|
Additional HMO Licensing
|
|
Other Fire Works
|
930
|
|
Management / Repairs
|
964
|
|
Structural Fire Works
|
523
|
|
Fire Alarms
|
397
|
|
Ventilation
|
189
|
|
Electrical
Works
|
109
|
|
Loft Insulation
|
85
|
|
Additional Facilities
|
76
|
|
Enlargement Of Bedrooms
|
475
|
|
Enlargement of Kitchens
|
7
|
|
Gas Certificates
|
4
|
|
Total
|
3,759
|
3.28
The council monitors compliance against conditions and inspects
properties in order to ensure they have been completed. At
the end of January 2023 66.3% of HMOs with special conditions had
compiled with these. This is an indicator that has steadily
risen over a period of time and is expected to increase further as
the remaining visits to sign off the conditions are
completed.
3.28
During the life of the scheme 1,802 requests for assistance were
made about HMO’s within the Additional Licensing scheme which
accounted for 11% of all requests for assistance during this
period. The level of rate of requests for assistance related to
already licensed HMOs could be due to a number of reasons, which
all demonstrate the need for the ongoing licensing of these
properties:
·
Tenants having more confidence to report issues once property
licensed
·
Higher tenant turnover impacting on dwelling quality resulting in
hazards continuing to be identified
·
Level of proactive property management is variable
A scheme is also
still necessary as new HMO’s continue to enter the market or
there has been a change in ownership resulting in the need for the
property to be licenced again. There will also be HMO’s
that the council are not aware of and that require licensing.
Whilst the schemes to date demonstrate a substantial reduction in
hazards and improvements required, improvements are still being
identified. Licensing enables the council to be proactive in
its involvement with the sector minimising reactive work.
Options
3.29 Two
Housing Committee member workshops were held on the 1 and
22
February 2023 to review the evidence and options for discretionary
licensing in the city. The first workshop considered both an
Additional Licensing Scheme and a Selective Licensing Scheme.
Evidence supported an Additional Licensing Scheme for smaller
HMO’s on a city wide basis. Options for a Selective Licensing
Scheme were based on the English Housing Survey national average
percentage of private rented homes (19%). This provided
options for a possible selective licensing scheme in 20 of 23 wards
in the city based on poor property conditions. There was also
evidence of deprivation linked to five wards but the link was
unclear due to the ward boundary changes and duplication with Local
Super Output Areas (LSOA). It was agreed that further work
would be completed to understand the linkage with deprivation.
3.30
Further analysis of deprivation was completed with LSOA data
aggregated for some wards, an approach supported by Department for
Levelling Up, Housing & Communities (DLUHC). A review of
average levels of PRS was also undertaken as new census data
released in January 2023 increased the national average to 20.3%
above the previous 19%. Applying these new metrics a new
option emerged which would support a phased approach to the
introduction of a selective licensing scheme. New deprivation
evidence confirmed that four wards were in the 30% most deprived
wards in the country. A first phase of a scheme could include
these wards on the basis of poor property conditions and
deprivation. This scheme would be 16% of the private rented
stock and 15.6% of the geographical area meaning that Secretary of
State approval would not be required. A 2nd phase
could also be considered for a further 13 wards based on poor
property conditions. An application would need to be made to the
Secretary of State for a second phase.
3.31
Taking this new information into account three options were
considered with Option 3 the preferred option. The table
below highlights the three options in more detail.
|
Option 1:
·
Selective licensing
scheme in 17 wards on poor property conditions
·
City wide
Additional Licensing Scheme
|
|
Option Description
|
For
|
Against
|
|
Introduce a
Selective Licensing Scheme in the worst affected wards on the basis
of poor property conditions.
An Additional
Licensing Scheme citywide.
|
·
Includes a large
proportion of private sector homes
·
It can be demonstrated to be meeting our strategic
aims.
|
·
Would require
Secretary of State approval
·
Does not include link
to deprivation
·
Would be a very large
scheme c40,000 properties which would be challenging to
introduce.
·
Significant investment
required to mobilise a scheme of this scale.
·
Significant staff
resources would be required to run a scheme
|
|
Option 2:
·
Selective licensing
scheme in four wards based on poor property conditions and
deprivation only
·
City wide
Additional Licensing Scheme
|
|
Option Description
|
For
|
Against
|
|
Introduce a
Selective Licensing Scheme in the worst affected wards on the basis
of poor property conditions.
An Additional
Licensing Scheme citywide.
|
·
This option draws upon two criteria affecting four wards in
the city and provides a stronger evidence base. It would
tackle the worst affected properties first
·
It would not require Secretary of State approval
·
It will cover approximately 7,900 properties which is more
manageable to introduce.
|
·
Does not include a
2nd phase and any future selective licensing schemes
would be subject to a separate consultation
·
Does not reflect wider
evidence of poor property conditions in other wards in the
city
|
|
Option 3:
·
Phased selective
licensing scheme
·
City wide
Additional Licensing Scheme
|
|
Option Description
|
For
|
Against
|
|
Introduce a
Selective Licensing Scheme on a phased basis. Phase 1 - four wards
on grounds of poor property conditions and deprivation with the
option for a 2nd phase of 13 wards based on poor
property conditions
An Additional
Licensing Scheme citywide
|
·
First phase draws upon two criteria affecting four wards in
the city and would not require Secretary of State
approval.
·
Will cover approximately 7,900 properties
·
It would allow the council to consult on the larger
selective licensing scheme at the same time as the consultation for
the citywide additional and the smaller selective licensing scheme
in 4 wards
·
A phased approach reduces the risks in introducing a
scheme
·
Provides opportunities to learn operationally before a
larger scheme is introduced
·
It can be demonstrated to be meeting our strategic
aims.
|
·
2nd phase
subject to Secretary of State consent which may not be
granted
·
The 2nd
phase would need to be referred to the Secretary of State within a
specified timeframe
·
Would become a very
large scheme c40,000 properties which would remain challenging to
introduce.
·
Upfront investment
would be required to mobilise the scheme.
·
Significant staff
resources would be required to run a scheme.
|
Proposed fee
structure
3.32 As
part of the consultation on introducing or extending licensing, the
council must include the proposed fee structure and likely charges.
The current fee structure was reviewed and agreed by Housing
Committee in June 2017. This current fee structure does not include
Selective Licensing since we do not have such a scheme in the
city.
3.33 In
setting fees for licences, the council is entitled to take into
account all its costs in carrying out its functions in relation to
administering any scheme. Fees cannot be set at a level designed to
make a profit. Proposed fees are set at a level reasonably expected
to cover the costs of providing the service for the licensing
scheme. The fees are based on officer time and associated costs
involved in processing the applications, inspections and monitoring
including the relevant overheads. The majority of the costs
involved relate to staff time. All costs included are allowable
within the guidance for calculation of licence fees. The fee
structure will be a two tier process, the application fee and if
successful the licence fee.
3.34
With the potential for the proposals outlined in this paper
encompassing a significant number of homes, it is important that
the fee structure encourages landlords to apply promptly and also
ensure their homes meet the required standard with minimal
intervention from the council. This would minimise the fees for
compliant landlords and also reduce pressure on the council in
managing the scheme. As with previous discretionary licensing
schemes, resources would have to be weighted to ensure are the
greatest demand for licenses at or around scheme commencement can
be managed.
3.35 If
Committee approve the preferred option and decision to consult, we
will review the existing fee structure and bring this to Members
for approval prior to the consultation commencing.
3.36 Outline
timeframe
Subject to Housing
Committee permission to consult:
·
3 months: Recruit a Programme Manager and procure consultation
provider
·
Housing Committee report on proposed fee structure
·
3 months: Consultation (12 weeks)
·
2 months: Review results and compile
·
Housing Committee report on consultation findings
If
further discretionary licensing is subsequently proposed and
approved by Committee:
·
Secretary of State application (if necessary)
·
3 months: Designation notice of schemes
·
Scheme go live for Additional Licensing Scheme/Selective Licensing
Scheme if Secretary of State approval is not required.
3.37 Any
selective licensing scheme timeline could be subject to extension
if Secretary of State approval is required. The timeframe may also
be affected by any challenge to proposals or process through
judicial review.
4. ANALYSIS &
CONSIDERATION OF ANY ALTERNATIVE OPTIONS
4.1 When considering whether to
make a licensing designation a local housing authority must
consider whether there are any other courses of action available to
it that would achieve the same objective or objectives as the
proposed scheme without the need for the designation to be
made.
4.2 Only where there is no
practical and beneficial alternative to a designation should a
scheme be made. If the local housing authority decides there is no
practical and beneficial alternative to the scheme, it must only
make the designation if it is satisfied that the scheme will
significantly assist it in achieving its objective or objectives,
with other actions the local housing authority may be taking.
4.3 Four possible alternative
options for tackling problem housing in the city were identified
and are set out below:
A.
Do nothing
B.
Use existing reactive
powers
C.
Targeted use of
Management Orders
D.
Area-based voluntary
accreditation
4.4
The Strengths and Weaknesses of each option highlight that none are
expected to be able to bring about the scale of improvement that
the evidence suggests is required.
|
Option A: Do
nothing
|
|
Option Description
|
For
|
Against
|
|
This option would involve the
council doing nothing to intervene in the sector, leaving the
housing market as the driver for landlords carrying out
improvements to their properties
|
·
No additional resource
costs
·
Housing market
determines the quality of accommodation
·
Meets aspiration for
many landlords for self-regulation
|
·
Not a viable option. If no action is taken, the significant
problems with poor housing conditions will continue and are likely
to increase further as the private rented sector continues to
grow.
·
Community concerns not
addressed
·
Concerns of people
renting not addressed
|
Option B: Use existing reactive
powers
|
|
Option Description
|
For
|
Against
|
|
This option envisages council
intervention in the sector being limited to a ‘complaint
response’ service with action by other departments and
agencies on a largely ad hoc basis using existing powers
|
·
Responds to
tenants’ expressed concerns
·
Ensures council meets
basic statutory responsibilities towards standards in rented
housing
·
If pursued rigorously
sends a strong signal and may lead to subsequent voluntary
improvement
·
Should produce
worthwhile improvements in neighbourhood environment, external
appearance, structural integrity, fire safety in cases where these
tackled
|
·
Reactive intervention
not strategic
·
No impact beyond the
subject property
·
Wider issues in rented
stock not addressed
·
Key issues (amenities,
space, health and safety) would be overlooked
·
Underreporting due to
fear of retaliatory eviction
·
Labour-intensive, so
costly
·
Council
funded
·
The absence of
licensing significantly reduces the scope of the council to impose
civil penalties in respect of identified housing
breaches.
|
Option C: Use of Interim
Management Orders
|
|
Option Description
|
For
|
Against
|
|
Interim Management Orders or
Special Interim Management Orders with regard to anti-social
behaviour if problems are associated with a small number of
properties. Once made, the Order is implemented until the property
was fit either to be handed back to the landlord or if necessary,
sold to a Registered Provider
|
·
An effective response
to the most serious problems.
·
Local Authority taking
control means work done to proper standard, management issues
resolved optimally
·
Action sends a strong
message that poor standards will not be acceptable
·
Removes landlord responsibilities and transfers to
responsible nominated agent
·
Improves property standards
|
·
Powerful reactive
enforcement action, not designed to secure overall stock
improvement
·
Strict statutory
criteria for use of the power; these will apply to a small
proportion of the overall stock
·
Highly
resource-intensive for council
·
Lengthy legal
processes lead to delay
·
Minimal impact on the
overall level of poor-quality rented housing
·
Council
funded
·
Not a proportionate
response
·
Does not tackle poor management
·
Represents a last resort intervention
|
|
Option D: Area-Based Voluntary
Accreditation
|
|
Option Description
|
For
|
Against
|
|
Accreditation schemes are a set of
standards (or codes) relating to the management or physical
condition of privately rented accommodation that recognise and
reward landlords who manage their properties to a good
standard
|
·
Accreditation’s
proven track record in parts of the country
·
Easy set-up through
access to existing local and national Accreditation
models
·
Rewards responsible
landlords for their efforts
·
Prospective tenants
signposted to quality accommodation run by responsible
landlords
|
·
Accreditation would
tend to attract the responsible landlord, be ignored by the
irresponsible
·
No particularly strong
incentive for poor agents/landlords to join
·
Brighton & Hove is
a high demand area – impact of area-based accreditation
likely to be minimal
·
This requires voluntary landlord engagement. Our experience
is that attendance/membership is usually only by a relatively small
proportion of landlords.
·
The national membership schemes are currently available but
have not had a significant uptake or provided the necessary
improvements in the borough.
|
5. COMMUNITY
ENGAGEMENT & CONSULTATION
5.1 The need to
take action to improve conditions in the private rented sector has
come from a range of local consultation and engagement, such as the
discretionary licensing consultations in 2017 and the Homeless and
Rough Sleepers Strategy 2020-25. In addition to this, there
are specific consultation requirements that must be met before
Additional or Selective licensing can be introduced in an
area.
5.2 Before introducing an
Additional HMO Licensing Scheme, the council must comply with the
specific requirements set out within sections 56 and 57 of the
Housing Act 2004. This includes being satisfied that a significant
proportion of the HMOs proposed under the additional scheme are
being managed sufficiently ineffectively. Consultation must also
take place and the scheme must be consistent with the
authority’s overall Housing Strategy. Provided the criteria
are met then an application to the Secretary of State for
permission is not required.
5.3
To implement a Selective Licensing Scheme, Section 80(9) of the
Housing Act 2004 states that when considering designating an area
the local housing authority must:
·
take reasonable steps to consult persons
who are likely to be affected by the designation, and,
·
consider any representations made in
accordance with the consultation.
5.4
Local housing authorities are required to conduct a full
consultation. This should include consultation of local residents,
including tenants, landlords and where appropriate their managing
agents and other members of the community who live or operate
businesses or provide services within the proposed designation. It
should also include local residents and those who operate
businesses or provide services in the surrounding area outside of
the proposed designation that could be affected. Local housing
authorities should ensure that the consultation is widely
publicised using various channels of communication.
5.5 If the
designation does not require the confirmation of the Secretary of
State because of its extent the local housing authority must
consult on the proposed scheme for at least 10 weeks. The guidance
recommends that if the scheme requires confirmation the local
housing authority should aim to consult for at least 10 weeks
unless there are special reasons for not doing so.
5.6 The
consultation should be informative, clear and to the point, so the
proposal is readily understood. It should inform local residents,
landlords, letting agents and businesses about the proposed
designation, giving the reasons for proposing it, why alternative
remedies are insufficient, demonstrating how it will tackle
specific problems together with other specified measures, and
describing the proposed outcome of the designation. It is also
important that it is accessible to landlord who may not reside in
the area but have let properties in the City. It should also set
out the proposed fee structure and level of fees the authority is
minded to charge (if any). Consultees should be invited to give
their views, and these should all be considered and responded
to.
5.7
Once the consultation has been completed the results should then be
published and made available to the local community. This should be
in the form of a summary of the responses received and should
demonstrate how these have either been acted on or not, giving
reasons.
5.8 This report is recommending
to consult on the preferred option for a period of 12 weeks.
6. CONCLUSION
6.1 Evidence from the research
carried out by Cadence provides a strong case for citywide
additional licensing and the introducing selective licensing of all
private rented properties in four wards in the city with an option
to phase in a second scheme (subject to Secretary of State
approval).
6.2 In considering legislative
requirements and those of government guidance, the introduction of
citywide additional licensing and selective licensing in four wards
seem a proportionate, reasonable and strategic response to the
issues with management and standards affecting some of the
city’s private rented sector that existing (or other
potential) interventions have not been able to resolve.
7. FINANCIAL &
OTHER IMPLICATIONS:
Financial
Implications:
7.1
There is currently £0.120m one-off resources in 2023/24 to
pay for the support and consultation necessary to introduce further
licensing (discretionary and/or selective) in the city. A one-off
£0.100m budget for 2022/23, was originally earmarked for the
feasibility for an ethical lettings company has now been earmarked
for this purpose by the Budget Review Group and will be carried
forward to 2023/24. Budget Council 23 February 2023 allocated a
further £0.020m ‘to increase resources available for
the consultation on Private Rented Sector licensing in
2023/24’. If the cost exceeds £0.120m, it will need to
be managed within current budget resources for 2023/24. This will
be monitored as part of the Targeted Budget Monitoring (TBM)
process during 2023/24.
Finance Officer
Consulted: Monica
Brooks
Date:27/2/23
Legal
Implications:
7.2 This is a statutory process
and one which must be adhered too. As we have reached the point of
consultation, this has to be carefully considered and to be fully
aligned with the general principles of consultation. The
consultation must be accessible to relevant persons including
landlords who do not reside in the area. Failure to consult
properly could lead to a judicial review. Once the consultation is
completed it will have to be considered in detail and not simply be
considered as a formality.
Lawyer Consulted: Simon
Court
Date: 28.02.23
7.3
Equalities Implications:
In seeking to
tackle poor management and quality standards it is expected that
any licensing scheme would have a positive impact on tenants
including those with protected characteristics. A full equalities
impact assessment would be undertaken in relation to any
discretionary licensing scheme recommended to Housing Committee for
approval. This assessment would incorporate the relevant findings
of the stakeholder consultation to help inform decision making.
7.4 Sustainability
Implications:
The evidence has
identified poor property conditions in the private rented sector.
Action to tackle this is expected to improve the quality of the
city’s housing stock, thereby improving its
sustainability.
7.5
Crime & Disorder Implications:
None
7.6
Risk and Opportunity Management Implications:
Should the
stakeholder engagement support the need for further discretionary
licensing across Brighton & Hove, the scale of such a scheme
would require careful planning in terms of making sure the fees
structure reflected the need for sufficient staffing and resources
are in place to effectively implement and manage the scheme.
The proposed scheme
would require Secretary of State approval which may not be
successful. In addition, the proposed scheme could be
challenged b landlords incurring additional costs, delays and/or
schemes being rejected.
7.7
Public Health Implications:
Poor housing
conditions, impact negatively on health. Improvements to housing
quality and management will have a positive health impact on
tenants and neighbours. Adhering to standards can also lead to
lower carbon emissions, improved energy efficiency and reduced fuel
poverty,
7.8
Corporate / Citywide Implications:
The long-term
impact will be a higher quality and better managed private rented
sector to the benefit of owners, tenants and neighbours.
Improvements sought in management and standards related to private
rented homes will have wider beneficial impacts identified in the
report.
SUPPORTING DOCUMENTATION
Appendices:
1. Appendix
1: Private Sector Housing: Housing Stock Condition and Stressors
Report, Metastreet March 2023
Documents in Members’ Rooms
None
Background Documents
1.
Selective licensing in the private rented sector: A Guide for local
authorities, Department for Communities & Local Government 2015
(last updated June 2022):
2.
Feasibility Review, Cadence Innova, March 2023
