Independent Review of the Private Rented Sector

 

"Last Wednesday 15 May 24, Labour Housing Group was proud to host the launch of the report of the Independent Review of the Private Rented Sector. The full report is now available to read and download on our website https://lnkd.in/eAZi52Vc" 

"Landmark case win as Newham Council’s campaign against Rogue Landlords achieves major milestone"

 

Well done to Newham Enforcement officers and Cabinet lead Cllr Shaban Mohammed. More please, more. Need to make sure this "landlord" does not find ways to try and get around "ban". 

Hat tip @letsandleases via @NewhamBooker

• Newham Council win’s appeal case against rogue landlord convicted of seven housing offences in Newham;
• National banning order upheld by court marks a major milestone in the Council’s campaign against rogue landlords;
• Council accelerates work to protect Newham residents living in private rented sector.

Newham Council wins’ landmark case against convicted rogue landlord as court dismisses his appeal against a Banning Order following breaches of the Council’s landlord licensing scheme by renting an unlicensed property in Newham. The ban means that he is banned from renting any properties in Newham and the rest of England for three-years.

Convicted of seven offences under the Housing Act 2004, private landlord Mr Jahangir Hussain had originally failed to licence his property in Forest Gate in October 2021, which he used as a house in multiple occupancy (HMO). As well as breaching six other HMO Management Regulations, he received a fine of £10,000 plus the Council legal costs.

In February 2023, the Council successfully applied for a Banning Order against the landlord. Despite an appeal by the landlord, the Council won the case on 6 December 2023 and the Banning Order preventing Mr Hussain from renting any properties in England will now be in place for three years starting from 16 August 2023.

Councillor Shaban Mohammed, Cabinet Member for Housing Services said: “This Banning Order is a first for Newham and a landmark case in our campaign against rogue landlord and to protect the rights of Newham residents living in the private rented sector. We mean what we say, when tackling the scourge of rouge landlords who think they are above the law.

They aren’t and we’ll track down any landlord who tries to circumvent the rules that are there to protect our residents and their housing rights. We have very clear guidelines, information and support available for private landlords in Newham so that they can operate their businesses while also supporting the welfare of their tenants.

Mayor of Newham, Rokhsana Fiaz OBE said, “Mr Hussain has shown flagrant disregard of both housing and planning legislation, to the detriment of both his tenants and residents of the borough. Combined actions from across our Council shows that we are will do whatever it takes to protect the interests of our residents. This major milestone sends a message loud and clear that rogue landlords have no place in Newham. It’s all part of our campaign to protect renters rights, including calling for an end to no-fault evictions and introducing rent caps.”

Following the Banning Order, Mr Hussain who rents out several properties in Newham, Tower Hamlets and Haringey will be unable to do so for three years.

The Banning Order also prevents Mr Hussain from:

• Letting housing in England;
• Engaging in English letting agency work;
• Engaging in English property management work; or
• Doing two or more of those things
• Being involved in any way in any corporate body that carries out any of the above activities.

As well as obtaining the Banning Order, Newham’s Planning Enforcement Team secured two convictions in the Magistrates Court against Mr Hussain for breaching planning enforcement notices at both his properties within Newham. The notices related to the construction of extensions at those properties without the required planning permission. The cases have now been committed to the Crown Court under section 70 of the Proceeds of Crime Act, for consideration of confiscation and appropriate sentencing for the offences.

For more information on our Private Rented Property Licensing Scheme, visit the Newham website".

Newham Property Licensing Consultation - ends 26 January 2022

 

(Housing matters in Newham. Especially the Private Rental Sector. Take part in this really important consultation and let us try and keep and even extend the existing safeguards in Newham). 

Renewal of private rented property licensing schemes in Newham

"I am pleased to write to you with news of our statutory consultation on the possible renewal of our private rented sector (PRS) property licensing schemes in Newham.  As a valued stakeholder for our borough, I wanted to contact you directly and invite you to share your views on our property licensing schemes.

 

Why licensing matters

 PRS licensing is hugely important to our borough and residents. Our licensing of more than 40,000 properties has proved a crucial tool for the Council to ensure safe, secure, and well-managed privately rented homes in Newham.

 

Since 2013, our property licensing schemes have assisted in the recovery of £2.5 million in unpaid Council Tax, led to Rent Repayment Orders in excess of  £350,000 from unlicensed landlords, and supported 1100 prosecutions, all of which has helped to drive out criminal landlords while improving housing services for our most vulnerable residents.  Since 2018, licensing has also helped the Council to invest in relationships with landlords and tenants, as we have dealt with more than 95,000 requests and contacts from landlords or tenants and carried out 15,300 inspections and audits.

 

Objectives of the consultation

 We want to consult as widely as possible to ensure we develop a comprehensive understanding of how our PRS schemes are affecting residents, businesses, and property owners in Newham. I would be grateful if you could share information regarding our Consultation across your network and encourage anyone affected or interested in PRS property licensing to respond.

I would also like to encourage you to take the time to read the consultation proposal documents located on the survey page on https://melresearch.co.uk/newhamprs and at https://melresearch.co.uk/media/upload/files/RPL-Consultation-Proposal-NovV21-091121.pdf covering the latest statistics for the different Newham wards and deprivation indices.

We would appreciate hearing from you directly and/or you can respond to the consultation via this link, or the QR code (located on the next page): www.newham.gov.uk/propertylicensingconsultation. 

Please note that you have until 26th January 2022 to give your views.

To view the Council’s press release regarding our property licensing consultation please follow the link:

https://www.newham.gov.uk/news/article/743/newham-council-opens-consultations-into-groundbreaking-property-licensing-scheme

Helen Masterson
Head of Private Sector Housing Standards
London Borough of Newham"

Bad Regulation = Bad Landlords

Hat tip "Nearly Legal" and check out this sobering report on the regulation of private sector renting by the National Audit Office.

There are 4.4 million privately rented "households" in England. Those who have bad experiences of such renting may "find it contributes to serious illness, financial issues or homelessness...The proportion of households in England living in privately rented accommodation has approximately doubled in the past 20 years, and the sector faces several challenges:

On average, private tenants spend more of their income on housing (32%), compared with those living in their own properties (18%) or social housing (27%).

The market is increasingly populated by low-income groups, benefit recipients and families, whose access to other housing options may be limited.

In around 29,000 instances in 2019-20, households were, or were at risk of being, made homeless following an eviction that was not their fault.

Many local authorities face funding pressures, which can constrain their ability to check properties proactively for non-compliance and therefore places greater reliance on tenants being aware of their rights and reporting problems".

As the NAO chart shows (p16) what this means is renters in the private sector can suffer harassment, live in dangerous properties, face financial exploitation, receive poor service, unaffordable rents and be completely insecure. Ironically to use a phrase loved by the Tories about Social Housing it is increasingly the "tenure of the last resort".

While there are many good landlords who offer and maintain quality homes for rent they are often under cut by bad landlords.

What we need is not only greater regulation but for this to result in a shift in the power relationship between landlords and tenants. To do that we also need effective and independent renter unions.

"Landlord licensing can help protect our communities"

"Before I became the cabinet lead for Housing Services in May 2018, I had worked in inner City housing for over 25 years and thought rather arrogantly I had seen it all. The squalor, deprivation and human misery I have seen while out with our licensing inspection officers shocked me out of this complacency.

On one of my first visits we went into a small unlicensed 3 bedroom terrace house which had families in each bedroom, the living room and the loft. The rear garden shed was also used as accommodation but was at the time empty. The property was damp, poorly decorated, dirty carpets, broken and worn furniture with dangerous electrical and gas fittings. Each family were charged from £600 to £1,000 per month for their room. I am sure that Charles Dickens would have seen similar scenes in Victorian London.

This is despite Newham having one of the most extensive, longest running and most effective landlord licensing schemes in the country. Set up in 2013, renewed for another 5 years in 2018, the current scheme lasts until 2023. To do this we had to persuade a somewhat sceptical Government that licensing was necessary to tackle serious anti-social behaviour and housing hazards but also to protect tenants from exploitation and criminal landlords.

There are an estimated 17,000 landlords who have to register, pay a fee and comply with the terms of the license and we estimate there are at least 47,000 households renting privately licensed accommodation in Newham. Since February 2018 we have fined 247 landlords and prosecuted 38. Recently we have doubled the number of enforcement officers.

We have a huge private rental sector in Newham. In 2001 only 17% were privately rented; now it is nearly half of all homes. Prices of properties in Newham were traditionally low and this enabled private landlords to buy homes cheaply by London standards. However, between 2011 and 2018, rents increased in Newham by 56%, house prices by 89% – but salaries have only risen by 21%. Median monthly private rents in the third quarter of 2018 were above £1,400. This is one of the chief reasons that 50% of families in Newham live in poverty after their housing costs are taken into account.

There are a number of myths about local authorities and private sector rental licensing. I have been to ‘lively’ meetings with local landlords who are convinced that this is a “money making machine” for the Council and do not understand that their license fees are ring-fenced for enforcement and cannot be used to cross subsidise other council services.

We are definitely not, repeat not, “anti-landlord”, but we are anti exploitative and criminal landlords. There are many conscientious landlords who want to work with us to drive up standards. Many landlords will privately admit that bad landlords who fail to maintain their properties drive out their tenants who live nearby.

Some residents and tenants are frustrated that we are not always able to take the immediate and direct action to tackle anti-social behaviour and disrepair that they want to see enacted. To prosecute bad landlords we need to obtain sufficient evidence of criminality (“beyond reasonable doubt” standard) which is needed to satisfy the courts. It can sometimes be a slow and complex process.

To be clear, licensing is a success story, but is far from being a panacea for all housing ills in Newham. For example, we cannot license rent levels for affordability. We have a long wish list of improvements, including ending the incredible exemption that local authorities and the National Asylum Service enjoy from being licensed (and that includes our own council). We need the government to keep to its promise to get rid of section 21 (no fault evictions) but also the abolition of immigration checks on rental agreements and no recourse to public funds.

The Covid-19 pandemic has made all of us in housing stop and think about what we can do protect our community. Despite staff working from home they have managed to prevent many illegal evictions and stop people being thrown onto the streets.

Targeting our inspections and enforcement on dealing with damp, disrepair, overcrowding, unlawful HMOs, poor energy efficiency and fuel poverty would seem an obvious initial response to Covid-19. To be frank, we are also worried that when/if the Government allows housing courts to fully operate again then there could be a huge increase in evictions (legal and illegal).

Licensing and our Homeless prevention and assistance service will be working together to manage this. We will not hesitate to prosecute anyone who criminally evicts or harasses tenants. We will also, if appropriate, refer them also to planning enforcement, council tax fraud and HMRC.

Future plans include: completing the setting up of new Empty Homes and Energy Efficiency teams; a communications campaign planned over the summer to increase awareness of rights and responsibilities for tenants as well as legal requirements for landlords; creating post(s) within the service to support PRS tenants and advise landlords.

We are stepping up not only enforcement but also our advice and support. Hopefully, when a future Cabinet lead goes out on inspections they will find a different story." John Gray

Hat Tip Red Brick blogThe place for progressive housing policy debate

(Check out Labour Housing Group event 10.30am Saturday 4 July "Developing a Private Rental Sector Fit for Purpose)

Reforming Private Renting: Sadiq Khan "Making... 7 May a referendum on rent controls"

Some really great policies on reforming our broken housing market in London. In Newham at least 48% of our homes are now privately rented. It is not unusual for a one bed flat to cost at least £1200 per month. 50% of our families live in poverty once you take into account housing costs. 

Hat tip http://conciliocomms.com/ -  "The Mayor launched his re-election campaign last week by calling on the Prime Minister to allow rent controls to be introduced if he wins power again. He said that a victory on 7th May would mean Boris could no longer ignore demands for the policy to be introduced as he would be 'ignoring the democratic will of Londoners'.

The Mayor said:

“The case for rent controls is now absolutely undeniable. But Tory ministers have blocked us from introducing our plans for rent controls in London and have simply said no.

“That’s why today I am making the mayoral election on 7 May a referendum on rent controls – showing Londoners that I will stand up for renters. The prime minister will have to give us the powers we need because if he refuses to do so he will be denying the express democratic will of millions of Londoners. And as we have all heard Boris Johnson repeatedly say himself, the democratic will of the people must be respected and it is not for politicians to frustrate it.”

There are 2.4 million private tenants across the capital, spending on average 43% of their income on rent. Between 2010 and 2020 rent costs rose by almost a third in London, and the average private rent for a one-bed home is now more than the average for a three-bed in every other region of England.

The Mayors re-election website is available here with a GLA report on rent controls available here."

Labour is on the side of the tenants: Tories are on the side of BAD LANDLORDS

ITS TIME FOR REAL CHANGE

Labour vows to “put bad landlords out of business”

Fantastic news. Hat tip Sienna Rodgers Labour List

"Labour has vowed to “put bad landlords out of business” with fresh plans for housing that will see private sector renters offered new rights and a national ‘property MOT’ introduced.

Announcing the set of policies on Monday, Jeremy Corbyn and John Healey will explain that a Labour government would require landlords to complete an independent annual inspection.

The move would ensure homes meet a decent standard, with “dodgy landlords” having to pay tough fines of up to £100,000 for a single offence and even repay rent to tenants if the let property is sub-standard or rules are broken.

Landlords would need to possess a valid ‘MOT’ before letting out a home. The inspections would be conducted independently, with local councils acting as enforcement authorities.

The Labour leader and Shadow Housing Secretary are also expected to outline how they want to empower tenants and local authorities with a new ‘charter of renters’ rights’.

The charter will be based on the following:

• The right to an affordable rented home.
• The right to a secure rented home.
• The right to a decent rented home.

“Labour will be on the side of tenants and take on dodgy landlords who have been given free rein for too long,” Corbyn commented. “Real change means taking on those who exploit the housing crisis to charge eye-watering rents for substandard accommodation. 

“Labour will put power in the hands of tenants with our new charter of renters’ rights, a cap on private rents and funding for renters unions to support tenants to organise and defend their right to safe and secure housing.”

To make private rented sector homes more affordable, Labour intends to cap rents with inflation and – as called for by London mayor Sadiq Khan – give additional powers to cities that could implement further rent controls.

Local housing allowance rates, used to determine the amount of housing benefit or Universal Credit housing element received by tenants renting from private landlords, would also increase under Labour’s plans.

To boost security for both tenants and landlords who want to let their properties long-term, Labour favours open-ended tenancies. These limit the reasons for which a tenant can be evicted to non-payment of rent or criminal behaviour in the property, for example.

Labour would scrap ‘Section 21’ notices, known as ‘no fault’ evictions, which the Conservative Party has also included in its manifesto after Theresa May announced the proposed abolition in April.

To be considered “decent”, homes should meet the current statutory minimum standard for housing, be in a reasonable state of repair, have reasonably modern facilities and services, and provide a reasonable degree of thermal comfort.

Healey, Labour’s housing spokesperson, said: “The power imbalance in the private rental market is at the heart of our housing crisis, with rents eating up too much of people’s pay, tenants afraid of eviction if they report problems, and families with children forced to uproot their lives at short notice.

“Many landlords provide decent homes that tenants are happy with, but the Conservatives have gifted rogue landlords the freedom to flourish. Labour will put bad landlords out of business.

“Labour will legislate in year one for a new charter of renters’ rights, with open-ended tenancies, new minimum standards and rent controls to make renting more affordable. We will make private renting a better option for all.”

According to new research by Labour, tenants collectively pay over £10bn a year in rent to landlords letting out sub-standard homes. A quarter of private rented homes are classed as ‘non-decent’, which means they are damp, cold, in disrepair or unsafe to live in.

One in four families with children now rent privately, Labour has found, and 1.7 million private renters pay more than a third of their income in rents. The private rented sector has grown by over one million households since the Tories took power in 2010".

Campaigning for a Fairer private rented sector

This is a model housing motion from London Labour Housing Group. It makes perfect sense to me. I have submitted to West Ham GC as a UNISON delegate.  

"This conference notes:

1.That the number of households in London who rent from private landlords is up from 15% in 2000 to 27% in 2017 and that Shelter forecast that nationally this growth will continue.

2. The lack of security for private tenants causes unnecessary homelessness and makes it very difficult for private tenants to lead settled lives.

3. High rents in this sector cause hardship for tenants and leads to the taxpayer subsidizing private landlords via housing benefit.

4. Shelter believe that the reasons behind Labour winning in Canterbury and Kensington is due to the number of private tenants voting Labour ( the rentquake).

Conferences therefore calls upon the London Labour Party:

1. To hold a London wide campaign day in 2019 for Labour’s proposal to improve the private rented sector.

2. To produce campaign materials for constituency labour parties on the private rented sector.

3. To set up an on -line petition to call for an end to no fault evictions and rent controls for the private rented sector.

4. To produce guidance for all Labour Council Groups and constituency labour parties on how the Letting Fees bill currently in Parliament should be enforced by local councils.

5. To ask the London Mayor to produce a vision for the private rented sector in the capital and to make the reform of the private rented sector a key political issue in the manifesto for the 2020 London elections.

"Raid uncovers horror conditions" Housing in Britain 2018

I was also simply appalled to visit such a dirty, infested, unsafe and unlicensed house and to hear from tenants about the threats made against them. I felt that I was back in Victorian East London and not the 21st Century.  Sickening.

Hat tip Newham Magazine. 

Newham private rented sector licensing scheme breaks £5m barrier for recapturing lost Council Tax

​Since the introduction of licensing in 2013 an extra £5,002,203 has been collected from rogue landlords renting out houses in multiple occupation.​

​Newham’s Private Rented Sector (PRS) licensing scheme began five years ago but was forced, by government, to re-launch from scratch in March 2018. Since its restart the PRS Team have processed and issued over 30,000 new licences.

In the same period the team has taken action against landlords in 120 cases where serious and dangerous disrepair was discovered or landlords were breaking the law.

Cllr John Gray, cabinet member for housing said: “This five million pounds, which would have been lost to the council, and therefore the tax payer, has been recouped by the private rented sector team, and will help us fund the crucial services that our residents rely on, from elderly care, to supporting our young people.”

The council would like to thank those landlords who have joined the new scheme, but remind those that have not yet applied that failure to get a license can result in fines of up to £30,000 or a criminal prosecution and unlimited fines.

In addition from the 1 October this year, new regulations mean properties, no matter how many floors they are arranged over, which are rented to 2 or more households, and/or 5 or more  occupants require a mandatory HMO licence.

The new legislation won’t affect most Newham landlords as they are already required to get a licence to rent out to three or more individuals through Newham’s Additional HMO Licensing Scheme.

The exception is some landlords in the E20 (Stratford New Town) ward will now be required to obtain a HMO licence where previously they were not required to.

The change of rules has been introduced by government, but will be implemented by Newham Council’s Private Sector Housing Team.

Cllr Gray said:  “I would urge any landlords to engage with our team especially if they are unclear about the new regulations. We genuinely want to work with landlords to create a fair rental market for them, and for all our residents. Together we can work to drive the rogues out of the market and improve the lives of tenants.

Hat tip Newham Council press release

Local Government Chronicle Investment Summit 2018

Last week I went to this summit in South Wales on investment in the Local Government Pension Scheme. There was around 250 Councillors and Council pension staff from all over the country.

I am particularly interested in the latest ideas on Risk, Asset allocation, ESG (Environmental, Social, Governance - also known as socially responsible investment), investment in housing and infrastructure.

The opening speaker John Roe from Legal & General gave his perspective on the UK and global economy. He argued that he did not think that the equity market was expensive and made an observation that rising income inequality had led to the rise of fascism and the anger that caused Brexit. I asked him in the Q&A what was the solution and he said greater taxation of the international elites and an open debate on immigration. Not often do I hear calls for greater taxation in such conferences (I agree totally with him on this point)

Next we were invited to visit different briefing sessions. I went to the one on "Fixing our broken housing model". Which turned out to be an introduction to the merits of pension funds investing in purpose built private sector rental but not alas, fixing the complete and utter mess that UK housing is in.

Back in the main hall we heard of research by Hymans Robertson that following the changes in the LGPS in 2014 some scheme members had actually seen their future pension entitlement rise by 24%.  Which is mainly due to rubbish pay in the local government in recent years which has failed to match inflation.

In a focus session on ESG investing there was some compelling evidence from MSCI that good ESG is "material". Good ESG investments tend to have better cash flow, be less risky, result in greater dividends & make it 3 times less likely to suffer serious incidents such as the Volkswagon fraud and BP Deepwater disaster.

At the next focus session, Abbie Llewellyn-Waters, from Jupiter gave evidence that ESG can deliver "Alpha" performance. Also, with regard to the S (social) in "ESG", she was clear that “the better that companies treat their workers, the better the companies financial results.....without a shadow of a doubt”

Roger Phillips, chair of  LGPS National advisory board spoke to a meeting of Councillors only on its annual report. Membership of the LGPS had increased to 5.6 million members, had £263 billion in assets, 1700 different employers and enjoyed in 2017,  a 19.5% increase in investment performance. However funds need improve their data management.

At the session on “Infrastructure, urban regeneration & real estate”, to wake everyone up, I asked the panel who had spoken about the investment opportunities on investing in this asset class about the statement by Sir Howard Davies, Chair of RBS who said on Question time early this year that “PFI was a fraud on the people”.  He had argued it was always cheaper for Governments to borrow money than private organisations to spend on infrastructure. How do you respond to this statement?

The response was that Government does not want such debt on its balance sheet. Which is an argument post 2008 crisis and post quantitative easing that I have not heard for many years.

In the last session of the day with the Pension Regulator & the FRC, I asked both speakers why was it that in private defined benefit schemes, up to 50% of trustees were nominated by beneficiaries but in the LGPS, a public defined benefit scheme, there was no obligation whatsoever to have any beneficiary representation on its boards?  The regulator replied that they did support member nominated representatives in the private schemes because they can challenge "group thing" but they also have pension trustees boards that only have professional trustees on it.

I note that Labour is committed to make 50% member nominated representation compulsory in all pension schemes.

At the summit dinner the guest speaker RH Lord Winston of Hammersmith, who was as entertaining and as "nice" in real life as he appeared on the telly.

In the morning after more presentations on successful partnership working (Pooling) and protecting your equity portfolio from a future crash (which I am sure is coming sometime soon) I went to a briefing session on "Is sustainable investing just a romantic notion?" session with Newton.

Who pointed out that some $300 billion was invested in alternatives to carbon in 2017. They also compared modern day oil reserves with the 19th century slave ships which became "stranded assets" when slavery abolished

Secretary to the National LGPS advisory board, Bob Holloway, reflected on 35 years involved with local government pensions and announced a meeting with the minister for council pensions committee chairs on 15 November 2018.

In the last session on Devolution and Regionalism, Dawn Turner, CEO of the Brunel Pension Partnership talked about not investing infrastructure because the Government tells us to do it but if it fits our needs & purposes. Also, we are not impact investors but should be aware of any positive or negative impacts from our investments. Not just globally, but in the UK as well

Final speaker was Paddy Dowdall, from Greater Manchester Pension Fund about their investing in housing... “Council provides the land and the Pension fund provides the capital” also “by definition residential housing is local & who knows more about local than councils”. For many years they have invested a percentage (5%?) of fund locally and managed to avoid any "moral risk" by making sure that the actual investment decisions are made independently.

Overall, a very informative and useful summit. It has now been running for 30 years but will no doubt have to change in the future when the pools take on investment decisions from local funds even though funds will retain responsibility for liabilities and asset allocation.