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Yet another local authority has set its sights on compulsory landlord licensing for every privately owned rental property within its boundaries. 

Liverpool City Council Want Landlord Licensing To Become Mandatory

Liverpool City Council Want Landlord Licensing To Become Mandatory

Liverpool City Council is the second local authority in the UK to launch a consultation for the introduction of a citywide landlord licensing scheme affecting over 50,000 properties.

The controversial move towards mandatory licensing of all private landlords follows that of Newham, in London, which became the first council in England to introduce mandatory licensing of all private rental properties on January 1st.

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The recent landmark decision to licence all private landlords made by Newham Council could damage the UK’s Private Rental Sector (PRS) if other local authorities adopt the same initiative, according to a number of the UK’s leading property professionals and landlord associations.

The mandatory licensing scheme, which will affect some 35,000 PRS tenancies within the borough of Newham, is intended to reduce the letting of sub-standard rental accommodation and remove rogue landlords from the local lettings market.

All landlords will have to sign up to the scheme, with landlords who fail to obtain a licence facing prosecution and fines of up to £20,000 (GBP).

However, with all UK local authorities subject to financial reforms many of whom will be facing budget and staffing cuts there is some doubt as to exactly how the new regulation will be implemented.

Local authorities across the UK who may now be considering adopting a similar mandatory licensing scheme for landlords are urged to take into account the financial and economic risks to their own local lettings market, by the property professionals operating within areas that may be considering such a move.

It is widely believed by many property professionals that blanket licensing of landlords only penalises good landlords while rogue operators remain off the radar.

Whilst there are bad landlords in every region of the UK, they are a tiny proportion of the overall PRS landlord network. Over regulation of the private-rented sector can stifle good business practices and deter tenants from seeking out rental properties managed by compliant landlords due to unnecessary red tape.

Any reform of the UK PRS should be sector led and funded, maintained and enforced by the Government. By imposing this poorly conceived micro regulation, Newham council could force landlords to leave the borough all together, reducing the available rental housing stock

The news of Newham councils decision came shortly after the Welsh assembly announced proposals for a scheme similar to that in Newham – a registration and licensing scheme for all private sector landlords in Wales.

The Private Rental Sector plays an invaluable role in reducing the national housing deficit, homelessness and creates business opportunities. It is crucial to keeping tenants that could be potential first time buyers with a roof over their head whilst they save for a deposit to purchase their own homes and extra bureaucracy will deter even the most diligent of landlords.

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