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As members may have seen, I have been following the Consultation to bring a Licence for every rented property in the City
Although I think it's a sledge hammer to crack a nut, I think it is needed and I think it will help professionalise the PRS in Newcastle City Council Housing stock
I hold at present one Selective Licence and I believe the Council will use a very similar template when they bring in the new Licence.
The key criteria is:
CRB checks for Landlords
Risk assessment for fire
Proof that a landlord has funds for repairs
Electrical Safety checks
Gas safety cert
A fit and proper person to hold a Licence.
Although it can be costly to obtain a Licence I think, in general, Good Landlords have nothing to fear as
They will be doing 90% of the work to start with
Bus drivers, Taxi Drivers etc have checks on their buses and taxis so I think its reasonable for us to fall in line
And I think it has to help in the long run to exclude Landlords who should not be landlords in the first place
It has been said that a new Licence will be around £700 per property
From my own experience I will budget for a cost of around £1200/£1500 per property to obtain a licence
It will be a bit of a challenge to organise and arrange inspections and to carry out the upgrades but I will just Budget it in for the next new Tax Year
I believe strongly that this sort of Licence will become the norm so my advice is plan for it
I also think a section of our community will leave with the new rules and maybe that's the section who should not be landlords to start with
What do you think will you be making provision for this topic and how much will you budget for per property?
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
You put forward and interesting case. I take the view that I oppose these licensing schemes at source. What do they do for me or my tenants? Extra costs increase rents - I meet all my legal requirements - no need for yet another layer of officialdom to certify it.
Licensing is simply a way for cash strapped councils to tax landlords. Those councils who partake in so called 'Licencing Schemes' would be more honest if they said they did not like private landlords and found them a useful way to raise local taxes. At £750.00 per rental property no wonder councils can build new council offices (Northants).
In my own area we have council elections in early May. I am standing for membership of our council, together with a group of other residential landlords, putting out a manifesto pledge that if we are elected the council will not bring in any private sector housing licencing. In my view this is landlord action that prevents unnecessary licencing, reduces local taxes and help maintain satisfactory rents. Derek Crane
I can’t argue with your view it is a money maker
NEWCASTLE have a habit of charging higher fees than anywhere else
I strongly believe other councils will follow suit because it generates cash and we all know councils need cash with the cut backs
but it’s going to happen
Central government and (local councils) invoke the law of least effort, always targeting the honest, decent, law-abiding people first, using them as a cash cow, because it's easier. Which is easier, stopping school kids being stabbed on their way home from school, or pointing a speed gun at passing cars? Or, for that matter, going round sticking parking fine tickets on cars merely because they're a few minutes over the permitted stay time, a restriction which frankly shouldn't be there in the first place.
Taxi drivers don't stick to the rules. My understanding of the law is that "Private hire vehicles can only pick up passengers by prior appointment only – if a driver stops to pick up passengers on the street without pre-booking, it invalidates their car insurance." Yeah right. We were in Blackpool last week, and late at night wanted a taxi back to our friend's house. There was a queue of private, i.e. not black cabs, hire cars only too willing to take us, no questions asked. And not a police officer in sight.
I know what you mean about Taxis
but we have a fixed asset and we can’t just move
I don't know anything about Newcastle but I very much doubt that's the case. I'm in the process of investing in South Wales where all landlords must register and have a licence with RSW. As an amateur landlord I can see this makes a lot of sense and with a cost of £33.50 for registration and £144 for a licence, valid for 5 years its not financially prohibitive. As the registration and licence is per landlord, not property its a fixed cost.
I was quite happy to pay the £177.50 and complete the licence process. However, upon investigation I'm not required to do so. I am primarily a lodger landlord, I'm expanding this to resident landlord with a common law tenancy, I now have a high street retail unit and I'm considering purchasing either a holiday let or a supported living unit. None of these landlord activities require a licence or registration.
It seems that every time there are rules, there are exceptions. Rent Smart Wales isn't perfect, but at least its consistent across the country. Maybe the English Councils and Government could learn something from it.
Newcastle is going to charge per property
the do give a discount for NLA members about £100 per property for selective licance
i have seen where rooms have to have new fire escape windows and fire doors
so costs can’t mount
fire detection has to be hard wired
again it’s costly
it’s up to the council to set the standards and that’s whete it becomes an argument
I have seen where common sense goes out the window
I could give examples but I won’t here
it’s a 20k fine for landlords who do not have a licance
so my advice is look at property now and think ahead and set aside funds to pay for it
Costs at that level, would not be a problem, but neither do they provide the income that councils are desperate for, i’d guess my local council would continue with fees at current levels within selective licensing , with “early bird discount”, reductions for having whole blocks this has come in at around £350 a unit for 5 years, discounts for accreditation are worthless to those with a buildings licence as it applied to the licence and not the number of units covered.
councils have lots of building control departments withering on the vine due to the opening up of the verification of works to outside contractors, it’ll not be hard to move staff across to rentals inspections. But in itself these costs aren’t what’ll hurt, it’ll be
belt and braces fire protection, fire inspections , electrical inspections, sound insulation , epc levels, professional indemnity insurance, compulsory accreditation, cpd, requirements for call out services contracts, etc etc.
it won’t all happen initially but it’ll all come along in time as “ mission creep “. It’ll work in tandem with increasingly punitive fines for contravention and little short of being hung drawn and quartered for non registration.
the only saving grace will be if there is sufficient pressure for the social sector to have to meet identical standards in the same timescales, but this will only slow the process not stop it.
Tax planning and disposal strategies will be ever more important considerations for the private sector.
If it gets through in one area, many other councils will follow suit, i’d put money on Thanet District Council doing so as soon as the current selective licensce scheme ends in 2021. It gives some within the spcouncils scope for “empire building” if the monies raised are ringfenced for private sector housing only, there will be some very well paid managment positions arising in short order.
Devil as ever is in the detail,
how long will a registration/ licence last,
will there be guidance on fees
discounts for building licences and accreditation
Will there be any legislative assistance and or direction to actively seek out those that don’t register and flout the rules, will the penalties for ignoring the rules both be sufficient and consistently applied to act as a real deterrent.
will council inspections become meaningful, my biggest bugbear is officers do nothing more than look to see if a smoke alarm is present , they won’t check to see if it works or that it is in date.
expect to see hugely expensive fire safety works being demanded by councils, especially regarding fire doors. I’d not be surprised to see a requirement for certificated installation and ongoing annual inspections being required for doors, smoke alarms etc over and above the current need for testing of emergency lights and signage.
there will be crossover to the owner occupier sector in respect of fire safety in blocks of flats etc. Pre 1991 flat conversions are going to be particularly hard hit.
It’ll all be tied in with the tightening on the definitions of an HMO and monies raised be used to catch all those currently operating undeclared.
it’ll do nothing for me or my tenants other than increase costs for us both.They won’t be insubstantial. I’d not be surprised to see the changes running alongside huge investment by the country in social housing and entry by the big corporates into build to rent, the tax advantages and economies of scale they will have will mean that the private sector will slowly but surely shrink, there will be fairly significant revenues from CGT as landlords leave the sector which HMG will have its eye on.
10-20 years from now i’d guess a private sector landlord will need fairly substantial portfoilios to make it work and for it to be their profession, hopefully this will be seen as such by the govt.
The sector is going to change from an investment sector to a bussinss sector
within 10 years it will be a different ball game
i can see the sector being half the size it is now
the large professional landlords will survive
I have used the cornershop compaired to the supermarket as a clear path for the prs sector
Yep that’s pretty much my view, with only 9 units i can see the numbers going against me within 5 years or so ( fall out from grenfell and licensing for all, i’ll have a bit of a headstart as i’ve 8 units under selective licensing so am compliant currently)
To survive in the longer term i’ll be needing the cash to pick up additional units released as landlords exit the sector. I can see my needing 20/25 units to make it work in 10 years. Which is not quite the drif into retirement i was hoping for.
Admittedly i look at it from someone who only lets flats, those with houses will have an advantages and survive with smaller portfolios.