Property expert Alan Bevan of City Residential says that while he supports landlord licensing, he believes the new scheme for Liverpool could lead to a shortage of homes and higher rents. Tony McDonough reports
A return of landlord licensing in Liverpool could lead to a shortage of rented properties and high rents if not managed properly, a leading city property expert is warning.
In his latest quarterly analysis of Liverpool’s property market, City Residential managing director Alan Bevan stresses he is supportive of the idea of landlord licensing but is concerned the new scheme is not sufficiently targeted and is “too broad a brush”.
In December it was announced Liverpool City Council had secured approval from the Government to begin a new landlord licensing scheme. It will cover around 80% of all rented accommodation in the city and will begin in April this year, lasting for five years.
There was dismay at Liverpool City Council when its previous licensing scheme, which ran from 2015 to 2020, was cancelled by the Government. The then Communities Secretary Robert Jenrick said there was not enough evidence of its effectiveness.
Around 45,000 of the 55,000 properties in the original city-wide scheme are covered. It gives the council additional powers to drive up standards and keep vulnerable tenants safe, such as tackling fire and electrical safety hazards, excess cold and damp.
The wards included are: Central, Riverside, Greenbank, Kensington, Picton, Tuebrook & Stoneycroft, County, Anfield, St Michael’s, Princes Park, Kirkdale, Old Swan, Warbreck, Wavertree, Fazakerley and Everton.
An evaluation of the previous scheme showed that more than 34,000 inspections of licensed properties had been completed, which identified that 65% of properties were not fully compliant on the first visit.
More than 2,500 legal notices had been issued with 169 formal cautions and 197 written warnings and more than 300 successful landlord offence prosecutions and issuing of 87 civil penalties.
Mr Bevan believes introducing a further layer of regulation into the market could see existing landlords leave the sector and deter other investors from joining. He explained: “Many landlords have been ‘clobbered’ over the last 4/5 years with copious amounts of new legislation, regulations, and tax increases.
“While several of these initiatives have been logical and required to maintain standards in the rental sector it has still had a negative impact on the number of landlords staying in the private rented sector and new investors buying in.
“We already have a situation in Liverpool generally where there is a lack of decent rental stock available to soak up the ever-increasing demand from tenants. This shortfall is creating a supply-demand shortfall which is resulting in rapidly increasing rents especially in many of the more popular locations.”\
He acknowledges that the standard of rental property in some parts of the city is “extremely poor” and “protection for vulnerable tenants is needed more than ever”. But he added the scheme should be targeted at those areas and the types of property and landlords where there is a high prevalence of poor standards.
“We’re not sure that this new scheme will address that properly, however,” he added. “It’s a selective scheme but with a much too broad a brush. This new approach by Liverpool city Council seems to fall between two stools.
“In our view it shouldn’t have included the city centre, because the majority of properties in this area have been constructed in the last 20 years and are apartments, which in the main have fewer issues than some older terraced properties in the suburbs.
“From our knowledge and the data collected by the council during the first five years of landlord licensing, there appears to be a much higher proportion of poor standards, non- compliant properties, and unprofessional landlords in these more deprived locations or where there is a higher student population.
We feel the approach should be more targeted, pursuing these landlords and properties with track records of poor provision and compliance, hitting them harder and ensuring that they have signed up to the scheme.
“A more focused scheme would allow a more aggressive clampdown on those landlords and agents who are not complying. Yet if the city centre area and other areas of higher compliance are removed how will the council pay for all the other inspections, enforcement and data collection?
“If it allows “people to thrive” and “gives tenants the peace of mind that (the council) have the resources and powers to help them’ as Louise Harford, head of Private Sector Housing at the council, wrote in a recent Liverpool Express blog, then it has to be welcomed and we fully support that. But it also has to be managed properly.”