Newham Council was the first local authority to take a major step towards improving the standards in the private rental sector in the Borough. In 2013 they decreed that every property needed to be licensed. This strategy was designed to combat rogue and criminal landlords who left their tenants dealing with unsafe and unsatisfactory accommodation.
The requirement is something that every investor and landlord should have been aware of. They should have considered it when they first took the opportunity to look at the investment properties Newham has to offer. Those that failed to do so may have exposed themselves to potential penalties, including large fines.
The original licensing scheme was agreed for a five year period. It is now nearing its end and Newham Council finds itself in a tricky situation. They are unable to renew it automatically due to stricter regulations imposed by the UK Government in 2015. As a result they have to apply to continue with the scheme from 2018 to 2023.
The local authority has stated its continued backing for the scheme and recommended that the housing minister and secretary of state for communities and government ratify the submission. This would allow the work to continue in the Borough and support the people in Newham who live in rented accommodation, currently nearing 50% of all households.
Since the licensing scheme was introduced council officers have served 2,170 notices to landlords, 1,135 prosecutions have been made, and 28 landlords have been banned completely from operating in the area. In total an incredible £2.6 million in additional council tax has been recovered.
Landlords, investors and tenants alike will all be watching carefully to see what the ruling is. Regardless of the decision, the attractive investment properties Newham has to offer will continue to draw people to make a purchase.
At Finefair we keep a close eye on schemes like licensing to ensure we can offer the clearest advice to all of our clients. We want to assist them in making the perfect decision, ensuring they understand all of their obligations. If you have any questions feel free to get in touch with us.