UK Residential Landlords Licensing Requirements Could Force Up Rents

A UK Government Green Paper will need all Landlords in England and Wales to be licensed once it becomes law. Previously, landlords of 3 storey properties which have 5 or more separate non associated tenants have also been required to obtain a license (such as student houses). Landlords in Scotland have been required to hold a license because 2006.

The plan is that all private sector residential Landlords will be expected to spend an annual licence fee of about £50 in an try by the Government to stamp out poor Landlords who do not comply with security regulations. It is not clear what the fee is supposed to cover.Will a certificate will be necessary for individual properties or for the person Landlord? Will the properties be visited and if so how frequently? Will Landlords will have to submit gas safety certificates along with license application, like an MOT for car tax?

What is clear is that the legislation will be introducing a whole new layer and department of bureaucracy for the letting business.It is most likely that the formality will deter smaller sized and one off investors in buy-to-let market, and pass on more expense to the tenant at a time when tenants are in much more debt than any time in the last 20 years.

The Residential Landlord Association is also expecting the license to be accompanied by the introduction of a statutory regulator for Letting Agents to tackle rogue agents. This measure is not expected to be an problem most great letting agents will already offer redress for all their activities.

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