Landlord Licencing – Why Residential Management Needs It

There is currently plenty of opposition to the idea of private landlord licencing by their powerful lobby organisations with objections ranging from a blanket ‘we don’t need any more legislation’ to ‘it’s just a scheme to make more money out of landlords’.

What we rarely hear about is how the lack of private landlord information is impacting on the residential management sector.

There are two types of private sector landlord – freehold and renting.

The Land Registry is usually the first place to go for information on both but has to be paid for. It has already been pointed out from some that a licence will duplicate information already held there but the Registry is by no means an ideal information source. For example, we have been led to believe that our freehold landlord is deceased leaving us to assume that the freehold has been willed (or even sold) to someone else. The Land Registry however has not been updated to reflect any changes, if indeed any have been made.

With regard to renting landlords, most of the flats in our development are sublet and on taking over management we needed to have their contact details. Again, the Land Registry was checked (because what contact information we had was gathered piecemeal) but when property is purchased with the intent to sublet there’s no mechanism in place to mark the purchase out as such so there isn’t usually any alternative contact information.

Our ability to manage effectively has been further impacted upon by landlords failing to advise us that they have entered into a contract with the local authority (usually for 3-5 years) and given up the property to them under their Private Sector Leasing Scheme. The council supplies the tenants and their managing agents look after the properties. Because the scheme is designed to temporarily house the homeless whilst their housing applications are being assessed, tenant turnover can be very rapid.

When I approached our council to find out what flats came under their remit (we had been relying on hearsay and continual fly tipping as indicators up until then) they not only cited Data Protection but they also asked me why should any landlord have to tell anyone else who (s)he was sub-letting to, private or otherwise. To make matters worse it was of no interest to them that a legally recognised management company was requesting the information.

When we had to ask one of our leasehold landlords on the scheme for additional contact details because the council had placed an anti-social tenant in his flat it took a lot of digging on our part before we established it wasn’t even our local authority that had placed her there, it was another one!

Having had to deal with the fallout caused by a ‘rogue’ freeholder and now ‘rogue’ leaseholder landlords in a managed block, it is evident from this particular perspective that the PRS and leasehold sectors are inseparable. Nevertheless it may surprise you that at the time of writing, the proposed landlord register does not include the leasehold sector despite the obvious link. Having written to the CLG querying this I have been advised that ‘the conditions of the licence haven’t yet been worked out but they have noted my concerns’.

So how will a landlord register help us?

It will at the very least deal with two key issues affecting both sectors – visibility, which Dr Julie Rhodes in her Review took into consideration and information provision. Of course you won’t get every landlord out there to register but a significant majority will come to the surface if it becomes a statutory requirement. Currently the only people that hold any information on private landlords are the organisations that they belong to but membership figures only scratch the surface of the number of private sector landlords in operation. It should also be remembered that these organisations are in competition with each other and therefore, as far as I am aware, don’t cross refer member information amongst themselves.

The big questions for the residential management sector is,

‘how are we supposed to manage effectively when we are in effect being held to ransome by landlords who are not compelled to provide information?’

We are a block of 22 flats with our Right to Manage company, our managing agent, individual leasehold landlords, their letting agents, and now two local authorities!

We should not be expected to be reliant on the ‘goodwill’ of landlords when it comes to information provision particulary as they often hide behind letting agents, and, as we have experienced in the case of local authories, Data Protection. We have heard plenty from landlords and as there are two sides to every story, this is ours.

Written by Sharon Crossland

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9 Responses to “Landlord Licencing – Why Residential Management Needs It”

  1. Dan Hartley Says:

    Landlords are notorious about complaining about costs and spending. Lets face it landlord ing is a business and a professional requirement on all aspects is loing overdue by some.

    Is a landlord register really such a big issue or so problematic? who is it that is anti landlord register and what makes them so.

  2. So you want landlords to ALL be registered and monitored further. Maybe they could just attach CCTV to our lapels to cover times when we are not dealing with our properties.

    The only winners out of increased regulation is for those collecting the fees from enforced memebership schemes/scams. Everyone seems to want to make money outr of landlords, when will it stop?

  3. I am suprised to hear your local council would not provide you with the information you requested Sharon. We would of supplied it if a formal application was made with good reason and evidence of the issues you describe.

    I am involved in a LA private register for landlords who want to be associated with our scheme, though i can see the advantages of a centrally managed national database. What is the feedback from the landlord associations?

  4. Hi Incensed
    Thanks for taking the time to offer your comments.
    I can’t make the case for those of us that want licencing any clearer than I have already have and on a number of occasions. You make the point of people wanting to make money out of landlords and ask when will it stop?

    I have to ask though, what about the incentives that private landlords get, such as for example, when they enter the Private Sector Leasing Schemes providing them with a guaranteed income regardless of whether the property is tenanted or not?

    Having dealt with the problems a so called ‘rogue’ freehold landlord brought us, in the form of being forced to take over management, we now have the associated problems that so called ‘rogue’ landlords bring. On entering my 7th year of of trying to improve the fortunes of our block of flats (6 of those unpaid) I don’t think its unreasonable to expect those that choose to go into a business to make money to be compelled to provide some basic information!

  5. Hi Sue,
    Thanks for offering a comment.
    I have no idea how LA’s feel about the issue because my block is a private development. In all fairness I have to say I did later get some information from them but only when my local councillor stepped in.Unfortunately that turned out to be erroneous and Data protection was quoted when I requested a correction.

    I’m interested in the fact that you would supply information if a’formal application’ and ‘evidence of the issues’ was submitted as this was never suggested by our particular council.

    Whilst it is to be expected that the information would perhaps not be provided to just anyone, we expected that when requested from either a legally recognised company, such as our RTM company, or the managing agents we employ to act on our behalf,it would be given. We were very surprised to be advised that our council didn’t need to know about anything about our management structure.

    I contacted the Information Commissioners Office as a matter of curiosity and was advised that it should not have been withheld if the request was reasonable, which, when required simply from a management perspective, would surely meet this requirement.

    Yet another reason why we need some basic information at the outset.

  6. Hi Dan,
    Thanks for taking the time to comment.
    It’s the landlord lobby groups that don’t want licencing although in fairness to them they were broadly in favour of the initial suggestion that came from the Rugg Review. It’s the Government expanding on this that has caused the resistance. Having said that it should be remembered how the private rental sector and the residential management sector interact with each other. Both need a more solid platform to work from and the licence would go some way to providing just that.

  7. I can obviously not comment about other LAs only the one i work in. It probably does vary and will depend on managers etc but mine is very good and woould have probably helped if we could in the scenario you describe

    If there is a good reason he does take a common sense approach and i would guess he would of happily given you this information if you had sensibly requested it in an appropriate manner etc etc

  8. Landlords are adverse to the idea as it will cost them. Landlords i have ever known are only interested in the bottom line, full stop. You can tlet landlords decide anything as you know the way it will go. If it costs, lets not bother

  9. Hi TPwhy,
    Thanks for taking the time to comment.
    I think that whilst cost may be a factor, the cost for having a licence would only be a fraction of what they achieve in profits.
    There seem to be two issues here: one that they don’t want to belong to a membership organisation or attain accreditation (based on their response to the Law Commission proposals in 2008).
    The second, and to my mind the main one, is that they don’t seem to want to be visible across the board, thereby being the main cause of the fragmentation that is the private rental sector.

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