Buy to let licensing plan faces legal challenge

Landlords in Northampton are threatening to take legal action against a council licensing scheme for buy-to-lets and shared houses.

The Residential Landlords Association (RLA) has written to Northampton Borough Council stating that proposals to consult on the viability of a landlord licensing initiative in the city are “unlawful”.

Proposals have been discussed this month at a council cabinet meeting and councillors approved the plans to proceed with a public consultation.

But the RLA says that the plan to fund the consultation, expected to cost £100,000, from reserve funds and then pay the money back with income generated by a future licensing scheme, is unlawful.

Under the Housing Act 2004 and the EU Services Directive, fees can only be charged for operating the scheme, not any preparation work before it comes into place.

A recent case regarding licensing of Westminster sex shops made it clear that investigation and planning costs before the implementation of a licensing initiative are outside the scope of the charging provisions.

In its letter the RLA calls for “confirmation that no such recovery will be sought in the event of the licensing scheme proceeding”.

The council revealed in a press release at the end of February that it would be discussing the consultation plans on an additional private rented sector licensing scheme at the March cabinet meeting.

The announcement revealed consultation would take place in the next year and focus on the various options for an additional licence scheme for HMOs and other private rental properties.

Northampton’s private rented sector is estimated at 15,000 properties, marking a near double increase in the last 10 years. There are around 2,000 landlords in the borough, of which many are buy-to-let investors.

Councillor Mary Markham, cabinet member for housing, explained that poorly managed rental properties are seen to have a negative effect on neighbourhoods. Anti-social behaviour and noise nuisance are linked to the failure of some landlords to manage their properties effectively, she continued.


About Editor

Feel free to send comments or requests for content to the Landlord Syndicate editorial team

No comments yet.

Leave a Reply