Reading Tessa’s newsround from last week in my enforced absence I was surprised to read of the problem with Welsh landlords not signing up to the Rent Smart Wales licensing scheme.
What’s the problem?
For those of you living East of the Marches last November, the Welsh government introduced a scheme to licence all property managing landlords and letting agents in Wales that has to be complied with by 23rd November 2016, landlords have to undertake a short and basic training course aimed at helping them gain knowledge to run their business successfully.
The cost of the training course is £100 for the day and the cost of the licence is £33.50 and is valid for 5 years and that is per landlord, not per property and no checks are carried out on the properties in question.
Even in Wales where rents are cheaper than London, that represents probably only a week’s rent on a property for five year’s licensing.
The penalties for not doing so however, mean that an unlicensed landlord cannot serve a section 21 notice and leave themselves open to a £150 (or £250 fine depending on the offence) statutory penalty notice and if prosecuted, a fine of £1,000 (or unlimited depending on the offence).
There are also a range of other penalties for failure to comply.
So why is it, as Tessa pointed out, that only a fifth of landlords have registered with rent Smart Wales since November 2015 with only a few weeks to go?
Discussing with Welsh Enforcement Officers
I was training a bunch of enforcement officers in Wales last week and this subject came up for discussion.
The central administration centre for the scheme is Cardiff but the policing of it falls to the individual council areas.
Faced with such a massive failure or refusal to register presents them with a difficult challenge.
First of all are the resources to police a mass refusal of this kind. Councils across the country have trimmed back teams and deleted many posts leaving local authorities struggling in their day to day activities, let alone proactively seek out those failing to register for the scheme.
Then there is the political complexity of basically going to war against 80% of Welsh landlords en masse, which is the problem that this situation presents.
- Have 80% of landlords simply forgotten that they have a few weeks left to comply?
- Are 80% of Welsh landlords still ignorant of the requirement? This wouldn’t surprise me at all as 9 years in so many landlords stull don’t know about deposit protection legislation.
- Or, is it as I and the enforcement officers I was training believe, that at this late stage Welsh landlords are staging a silent protest, a work to rule, a refusal to comply amounting to a strike that the policing authorities don’t have the resources to do anything about?
Spoiling for a fight?
Nobody in the Welsh government seems to be posing this question and the Welsh landlord’s associations aren’t exactly throwing out press releases but a bit of a gang fight is brewing.
Are Welsh landlords effectively saying “Go on then. I dare you……I double dare you”? and if so what is going to be the response of the local authorities?
Nobody in the front line business is any doubt that nothing will happen. There aren’t the resources or the political will within local authorities to go to war on that level.
The best that will happen is that Solicitors, Shelter and homelessness prevention teams will concentrate on simply defeating possession claims on the basis of invalid section 21s but penalties and enforcement will be hard to find.
The main impetus for introducing the scheme is to help local authority enforcement teams isolate rogue landlords, giving them the powers to take their licence away and stop them earning a living from renting.
Admittedly there will be flaws in the system in practice but the aim is clear and yet Welsh landlords seem to be against ridding their business of the rogues who they all publicly condemn but privately have no interest on doing anything to eradicate if they have to pay for it, so you have to doubt whether or not they really care if the policing authorities take out the bad apples if it is going to cost them a day of their time and £133.50.
Ineffectual sabre rattling?
The result of this failure to register will mean that the licensing scheme will prove to be no more than a bit of government sabre rattling.
The landlord groups aren’t voicing a coordinated protest and the Welsh Government aren’t commenting on the astonishing failure of 80% of landlord to register just weeks away from the cut off date but the people who will be expected to move into action on the 24th November aren’t in any doubts that, failing a last-minute rush over the next 7 weeks the dissenting landlords have won.
NB Welsh Landlords can register here.
Note – we have been contacted by Rent Smart Wales who have asked us to add the following note:
The cost of a licence isn’t £33.50 – this is the cost of online registration. The landlord licence fee is currently £144.00 for applications completed online and £186 for paper applications.
The agent licence fee is determined by the number of properties in Wales managed by that agent and there is a discount if they are a member of a relevant professional body or a social landlord.
With regards to policing falling to individual authorities, this is actually a partnership arrangement between RSW and the 22 local authorities.
Also, local authorities will not have the ability to take licences away. This responsibility will remain with Rent Smart Wales.
“but the aim is clear”
The aim is very clear- to create more council jobs for the boyos.
Nothing to do with getting rid of rogue landlords, if anything it could be argued it creates even more.
Licensing hasn’t worked anywhere else and it won’t work in Wales. It is a pretence to be ‘seen to be doing something’ instead of tackling the very difficult, real problem.
Indeed, the amount of Welsh rogue landlords looks set to increase to 80%. And it is a fair bet the number of illegal evictions will go through the roof once the new rogue landlords realise they can’t realistically evict non paying tenants through the courts.
But those 20% of good landlords who have registered don’t just administer themselves! Doubtless someone will receive a knighthood for creating all these new ‘jobs’.
Any guesses when the first witch hunt of the good landlords will be? I reckon they will need to strip half a dozen of their licences by this time next year- just to prove it is all working.and hasn’t just been a completely pointless exercise in bureaucracy.
Firstly if housing benefit was not paid unless the landlord was registers…..
Then make it a legal requirement that RightMove etc checks the landlord is registered before allowing the property to be listed. (Likewise for Gas Safety etc)
Make it so the landlord automatically loses any deposit depute if not registered.
Make it so that the property owner is responsible for council tax and all utility bills if not registered.
Lastly if you want to get radical, allow tenants to keep £100 pcm of the rent if the landlord is not registered, with the registration only backdated to the day the landlord filled in the on-line form and paid up.
E.g. let the market do the policing….
PS, I am a landlord….
I like some of these ideas Ian. You should have drafted the bill!!
Re HB Welcome,
I see this more as a requirement for landlords to get training, and tell the council their address, so that if there are any issues the council knows who to talk to.
I hear what you are saying Ian but the 20% who have signed up are not the ones who need training.
If you and I were landlords in Wales, I have no doubt we would be part of the mug punters pointlessly complying.
It is the wrong target.
“if there are any issues the council knows who to talk to.”
I’ve never had an issue where a council wanted to talk to me, only the other way round. I expect you are the same.
But if they wanted to, a simple check on Land Registry would reveal all. Or they could ask the tenant. Or they could go for a bit of blue sky thinking and just ask their own council tax department.
As said, it is the wrong target.
Here we go again.
All council workers are feckless/lazy/ bureaucrats, delete as applicable.
Any attempt by local authorities to deal with the cancer of rogue landlords is ill thought out/self serving
Licensing of landlords is nothing to do with trying to keep on top of rogue landlords and only to deal with income generation.
Landlords are hard done by and the real problem is nightmare tenants.
Any attempt by the policing authorities should automatically be ridiculed simply because the council is behind it
Any attempt to deal with rogue landlords is only a witch hunt against the good ones.
Licensing doesnt work – well it certainly doesnt in Wales where only 2o% have registered and is that the council’s fault as well?
I tell you what…..lets do nothing and just let landlords sit back an earn their living without any sanctions.
OK the rogues, the people that beat people up and run properties with no fire safety precautions, no rent receipts, no deposit protection, non interest in following renting law, lets just let them do what they want
Well if the council can’t do anything about landlords not registering, then how do they propose to stop rogue landlords from carrying on as they were once they are ‘struck off’?
The only potential benefit to this system is to ensure honest, law abiding landlords have a better awareness of the existing legislation and their responsibilities as landlords. No bad thing. It will do exactly nothing to hinder those who, let’s face it, are devoid of a conscience, are without care for their fellow human beings safety and well-being and obviously have ZERO respect for the law! These evil social hyenas will carry on just as before.
Neither will it help to identify those who are rogue landlords. There is no property inspection to certify a landlord’s rental stock is safe and fit for habitation involved in the licensing process.
The law needs to be more effective in punishing those who behave this way. Give them a custodial sentence and repossess their properties if the crime is sufficient, or they are repeat offenders. At the moment they are simply walking away and refilling their properties with the next batch of victims.
Even implementing some of Ian’s suggestions wouldn’t be effective against the worst offenders because they simply target those who can’t object, the illegal workers, non english speaking immigrants, those with such poor credit they couldn’t get accepted anywhere else, or other vulnerable people. Give the law some teeth if government really wants to reduce this problem.
Have you followed the courses provided? Most of them are inaccurate! Well trained landlords!!!!! Mis- informed landlords more like it at the end of them. And they have to pay for the course!
“Here we go again.”
My thoughts exactly. However big the failure clearly is, councils can do no wrong.
“I tell you what…..lets do nothing”
No. Lets target the real problem.
Lets target the bottom 20% of landlords instead of the easy top 20%.
I totally agree with all the very good points that HB Welcome and Ian make. Ben the only thing you say that I fully agree with is:-
“I tell you what…..lets do nothing and just let landlords sit back an earn their living without any sanctions.”
I do not entirely blame councils though, they need to be seen to be trying and can only work with the powers given to them by central governments.
Persistent and blatantly bad landlords should be fined heavily and/or have their assets seized and the money used to fund the council enforcement teams.
I don’t mind paying a £100 to go on the Welsh training course – I might learn something but Liverpool Council have taken several times that amount off me just to register for their scheme with no training requirements.
I am sure councils are aware of the seriously bad landlords without requiring everyone to be registered so what is the point?
Ben I remember reading an article about your team targeting a street in London with gas, electric, immigration, police and other teams but only got a few premises done before you ran out of time. Can you give me a link to it as I can’t find it now?
I should perhaps mention here that Ben has done more to close down bad landlords than (probably) anyone else reading this blog – as can be seen not only from his writings here but also on various telly programs. He does know what he is talking about.
Good landlords on the defensive don’t realise how totally awful bad landlords can be.
@Ian I like your suggestions for enforcement!
A big difference with Wales is that they are not over charging normal landlords so as to fund the staff to go after the people that don’t get licences. If the enforcement can be made to work in Wales at no cost to the good landlords, then I would welcome the same system in the UK, provided the cost of a licence was the same.
Hello,
I have just read yesterdays blog about the number of welsh landlords yet to sign up to Rent Smart Wales.(RSW)
You quote that the license fee is £33.50, it’s not.
The Registration Fee is £33.50 and ALL landlords with property for rent in Wales must register.
If the landlord also manages their property (as opposed to putting it through a Letting Agent) then they also have to be licensed. The licence fee is £144.00
To get a licence they will have to do some training at whatever fee the trainers charge for it – it seems to be around the £100.00 mark, but there are lots of training companies out there each with different fees
So for a self managing landlord it is £33.50 + training fee + the £144.00 licence fee. So the better part of £270.00 or thereabouts.
NB – Landlords who are fully paid up members of the National Landlords Association can do their RSW training for free via our online landlord library, or attend one of our classroom based courses for £105.00
Thanks Julie
It would not surprise me the 80% of landlords are truly ignorant of the requirment.
Where I live the council’s faq on hmo licences states that it is the landlords responsibility to find out they have to register (you would think they could send a letter?). As in if they happen to not read the local paper about it or find out somehow they are stuffed. Its the same with the regulations; they are spead over so many acts it must be hard for a good landlord to know all the responsibilities.
One such example is the legionaries check that is hardly talked about. The remedy? As with the how to rent guide for tenants, how about a manuel in simple language the requirments for HMO’s to non hmos etc?
We have a free Kit for HMO landlords which you can sign up to here http://www.legalkits.co.uk/course-directory/
It’s transparently clear that what’s happening here is that the Welsh government is targeting those landlords who already obey the all various laws and regulations that apply to renting property knowing that they will also obey the new law about registration.
The landlords that don’t obey the law that already exists won’t obey this one either I will carry on doing what they’re doing completely Unbothered by the council, government or anyone else. Council employees regard these so-called rogue landlords are simply too much trouble to deal with. why go head-to-head with an a******e when you can have a nice time hassling perfectly decent people who aren’t going to set the dog on you/attack you/threaten you et cetera.
The vast majority – 80% apparently – are simply ignoring it and getting on with providing housing and earning a living like they always do.
Most people that work in local government didn’t make that choice to change the world but rather to find a cushy berth with good pay and a great pension. They can ensure that continues simply by going through the motions with plenty of pointless initiatives and without getting their hands dirty at all.
A fair few tenants (I’ve met some of them) are happily living rent-free in Scotland because a rent penalty notice was served on their unregistered landlord. These landlords come to councils’ attention one way or another and councils will hit these landlords where it hurts if they don’t comply and register. It’s a tactic that works. And any unregistered landlord in Wales won’t be able to serve a Section 21 then, I see. That’s good to hear.
Why should landlords comply and register? Because when you are in the business of providing homes you cannot just expect to go under the radar. You belong on a register. It wd make more sense to stop objecting and petition for a national registration scheme, with some uniform pricing and structure. But if licensing were completely free even, I imagine landlords wd still object to it.
A good registration scheme* wd do even more for tenants and really map some useful data. It wd detail the energy performance of a property and the landlord’s deposit history for example (amongst a raft of things). Data cd all be in one easy place for tenants to see, and it cd do much to encourage good practice. It has the potential to be very helpful for tenants and local authorities alike. Information is all over the place right now (and I think that’s how landlords like it)
* Julie Rugg has talked about the virtues of registration as opposed to just licensing here http://www.parliamentlive.tv/Event/Index/62f31699-63b2-4b31-83e4-7e06bedb7a8e (it will play, takes a minute)
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Landlords protest about licensing because they worry for what might come, I think. They don’t want to see it getting any better, and they conveniently just ignore the benefits that it can give to tenants. We just have more gangster talk here, in this thread again, with mention of “more illegal evictions”. It’s a sort of ‘come for us, and we’ll come for you’ threat really. A registered landlord is less inclined to behave badly, with good data mapping, I think.
As an aside: I do wonder how many landlords that protest about ‘unfair licensing’ are in favour of unfair letting agents’ fees.
Landlords (mostly) protest about licencing because they can see that
A) it is a cost that will be passed on to tenants in higher rents;
B) Bad landlords will not register and will continue providing poor quality housing and keeping their tenants in check by threats, etc because the chances of being caught are low and the penalties not that great, and their tenants are those who need “somewhere, anywhere” to live.
Dr Rugg makes the following points:-
1) Councils already know who the bad landlords are.
2) Bad landlords are often ignored because because the punishments given don’t make it worth the councils time.
3) If the council removed the registration of a bad landlord with many properties who looks after the people made homeless?
4) It is pointless councils wasting time on good landlords.
5) Existing registration schemes have generated a lot of documents nobody has time to process.
I still don’t understand how registration schemes tackle the real problem.
Rent Rebel – I think your database idea would fall foul of the data protection act and see point 5 above. The only people I know in favour of unfair letting agents fees are letting agents who are often charging the landlord as well.
If councils had the power to confiscate properties (if they are mortgaged from the lender) and assets from bad landlords and allowed to keep the proceeds would we need registration?
Agreed!
It would be very simple and cheap to compile a register of landlords via an additional question on council tax registration.
Perhaps not 100% accurate but as good as it gets and a lot better than the 20% achieved in Wales.
An easy solution, if that was really the aim of such schemes.
Let us have a voluntary national (UK) registration scheme for landlords on the understanding that it is combined with a national registration scheme for tenants. We can then match registered landlords with registered tenants and unregistered landlords with unregistered tenants.
Any tenant evicted under a section 8 should be de-registered and banned from renting for five years.
This scheme is only policing those who are willing to be policed.
In other words landlords who obey the rules will register and pay.
Those landlords who operate below the radar will continue to operate below the radar. They won’t register and if they don’t register then no authority will find them.
The training and assessment for a landlord licence is a completely pointless exercise.
I’ve just completed the training online and at no point in the process was there any validation of my identity. So, if I was a rogue landlord, which incidentally I’m not, I could very easily bypass the system by getting somebody to answer the questions on my behalf, while I popped to the pub.
What training would I have received? What would I have learned? How would this make me a better landlord?
Or, more simply but just as effective, I could have sat in my office with the assessment on my PC and simply Googled the answers and I would have passed without any problem at all.
What training would I have received? What would I have learned? How would this make me a better landlord?
Come on Rentsmart Wales. If you’re serious about improving the rented sector and not just in the business of generating enough income from already compliant landlords to keep yourselves in a job, you have a long way to go to convince me that you are up to the task.
The training is there so that any landlord who breaks the law, can’t claim they did not know what the law is. Nothing they are doing will effect rogue landlord, but it will make rogue landlord stand out more from landlords that just don’t know what they are doing.