Landlords warned licensing makes them responsible for tenants' behaviour
A senior figure in the Scottish lettings industry has warned his colleagues in England what they might have to expect if there is blanket licensing, and fees to tenants – for example for referencing and inventories – are banned.
Stuart White, of Century 21, which has several franchised offices in Scotland, said that licensing seemed little more than a ‘taxation exercise’ – which allows councils to ‘palm off’ their responsibilities regarding anti-social behaviour on to landlords and agents.
He said that currently, every Scottish landlord must register every rental property that they rent out, at the rate of £55 for the first, and £11 for each subsequent property. On top of that, all letting agents must pay a fee of £55 to every council in whose area the agent manages a rental property, regardless of whether there are one or several. All registrations run for three years.
White said: “We currently pay registration fees for 12 different local authorities in Scotland.”
He says that licensing has just two possible advantages. First, it is possible to track down who owns a property – which proved useful when tenants of a Century 21 flat were affected by burst water pipes in a vacant empty rental property above.
“The second benefit is that landlords understand that this is a properly regulated industry,” he said. “But having said that, I have never come across a single landlord whose application has been rejected. Nor have I come across a rogue landlord being expelled from the register. It predominantly seems like a money-making exercise.”
Of deep concern to White is that licensing makes landlords and agents responsible for the behaviour of their tenants.
He said: “It is absolutely outrageous the way this is abused by some councils, and they are simply making landlords and letting agents do their work for them.
“For example, we had a call from one council to say that their noise team had found a lot of noise coming from a property on a Saturday night, and discovered that we managed the property. But instead of simply knocking on the door to ask the tenants to turn down the noise at their party, they waited until Monday morning and wrote to us informing that we should deal with it..
“Had they knocked on the door, the tenants would have turned the sound down in all llikelihood.
“In a second incident, a tenant’s dog was alleggedly seen fouling a public space. Again, there was no attempt to approach the person. Instead, she was observed going into a rental property, and assumed she was the tenant, and once again, we were contacted and asked to deal with the problem and warn our tenant about dog fouling.”
Regarding the banning of fees to tenants in Scotland, with the ban affecting both agents and landlords, White hit out at Shelter’s campaign to achieve this.
He said: “I used to donate annually o Shelter, but I will never give them another penny while they remain on this path of attacking every single letting agent in the UK and I am sure other industry businesses will have the same opinion and have already re-routed their financial support to other causes.
“Millions of people would find themselves homeless were it not for the private rented sector, so to go to war with a whole industry is ill thought out. Surely, it is better to work with an industry to drive up standards.
“Following a recent ‘clarification’ the by the Scottish Government, it is said that nobody can charge anything apart from rent and a deposit for the setting up, maintaining or ending of a tenancy. Apart from the issue about reference fees, does this mean that no charge can be made for late rental payments? Damage to a property? Payments made by credit card? To name but a few instances where a tenant should legitimately be bearing the cost of their actions?
“Personally, I am astonished if the law really intended to state that a commercial business trying to cover its costs and losses for a landlord are acting illegally?”
He said different agents were adopting one of three solutions: some agents were telling prospective tenants to produce their own references, from a named supplier; the larger agents are, he claimed, adding to the first month’s rent and calling it ‘rent’ with lesser payments in months two to six. s Other agents are simply adding £25 to the monthly rent.
White said: “How has this helped tenants? Shelter should take a log hard look at what it is trying to achieve and might ultimately need to hang its head in shame if all it manages to achieve are higher rents being charged to tenants. Homelessness would rocket if just 5% of private landlords decided that had had enough of biased and aggressive policies, let alone the further financial burden of passing all costs on to a landlord, and left the sector.”