Newham Antisocial Behaviour and Private Landlords
Was Newham Council’s all borough landlord licensing scheme justified and was there really clear statistical evidence of a higher level of antisocial behaviour in the private rented sector, asks David Lawrenson of LettingFocus.com
I shared a platform with the London Borough of Newham at a Chartered Institute of Housing (London region) event yesterday – which over 100 delegates attended.
The event was focussed on the private rented sector, which is a topic which the CIH is now covering more at seminars and other gatherings. And about time too, some would say.
All in all it was a very useful event – and well organised too.
As well as myself and the Newham representative there was also a speaker from Crisis and one from the housing association, London & Quadrant (L&Q). I will say more about L&Q and their work in the private rented sector in a later blog post.
Newham were there to praise and extoll their landlord licensing programme. And with the hall being probably 50% filled with folk from councils, some of whom have the power to “do a Newham” in their borough, this was a real opportunity for the borough. (I guess it looks good if other boroughs copy the Newham model, allowing Newham to be billed as the trailblazer – which would no doubt go down well with Sir Robin Wales, Newham’s very ambitious and high profile mayor).
Newham and LettingFocus don’t agree on how to regulate and get the best out of the private rented sector and I’m not convinced their approach (which is to license all landlords in their borough) is the best way to raise standards nor put the rogue landlords out of business. (There is much more on our other blog posts on why I think this.)
At the meeting I had to take issue with some of Newham’s data. (This is not something I like to do, but with the room having all the council folk with power over whether to do licensing or not, I could not let the data go unchallenged).
A key Newham claim as justification for implementing the scheme was that antisocial behaviour was at a higher percentage around privately rented properties than around other types of dwelling. I seem to recall they said it was around 25% more likely to occur. (If this is incorrect, I am happy for Newham or indeed for local landlords to send me the exact, correct figure which I will publish here).
But if one thinks for a minute about where social housing and other housing is located in any location, it would be fair to say that private rented stock is usually “mixed in with” other housing types. Social housing (whether council or housing association) is much more likely to be with other stock of the same type, often on large estates.
It seems intuitive that owner occupiers are more likely to make a formal complaint about antisocial behaviour than social housing folk, so one would therefore expect that more complaints would be raised about private tenants than about social housing ones, simply as a natural consequence of who their neighbours are.
But another problem with the data is more significant. And that was that once the scheme went live, Newham realised (to their delight) that actually they had significantly under-estimated the size of the private rented sector in the borough by many thousands of dwellings. Newham freely admits this.
But herein lies a problem. If the original data on the number of private rented dwellings (based on census data, we understand) was so wrong, then the relative incidence of antisocial behaviour in the private rented stock must INTER-ALIA be also significantly overstated. (Put simply – the same number of ASB incidents divided by a few thousand more units would shift the percentage quite a bit, one would think.)
So, I would like Newham to revisit the statistics they used to justify their all borough licensing scheme with the better data they claim they now have on the true size of the private rented sector – to see if the incidence of antisocial behaviour in private rent was really any higher than in other housing types.
I suspect that it wasn’t.
This little tale also goes to show that for many councils, not only is there a lack of coherent policy on the private rented sector but there is also a lack of data on the size of the sector too, which means important policy decisions (such as whether to license landlords or not) are being made based on a fog of unreliable data.
The other issue I have with Newham’s scheme is that so little of what is done there seems to be around how to raise the standards in the sector – put simply: how to help the poorly-informed but non-rogue type of landlord.
You could say there is lots of stick but little carrot!
This is an issue I take with many London Councils – what they have in place to improve landlords knowledge and in particular, the amount of information they have online for both tenants and landlords in the private rent sector is still far too patchy, inconsistent and incoherent. (It is something that we have advised some councils on, but a recent review I did, shows that there is a long way to go).
One thing I hope that Newham and I would agree on is about the need for money raised from cracking down on rogue landlords to be kept in the boroughs.
Another thing I would hope they would agree on is that penalties should be reviewed and revised because it seems barmy that someone who has overlooked to get a license could be hit with a £20,000 fine while the penalties for planning breaches and failing to get a valid landlords gas certificate remain so pitifully low.
COMMENT ADDED BY THE NATIONAL LANDLORDS ASSOCIATION CHIEF EXECUTIVE OFFICER, RICHARD LAMBERT
We too had an issue with the data Newham used to justify the introduction of the licensing scheme, which I set out in a blogpost on our website explaining why the NLA decided not to pursue a legal challenge. Although superficially, the evidence report presented a convincing case for a link between anti-social behaviour and privately-rented properties, we could not assess whether the conclusions were justified without looking at the detail of the evidence, and Newham were determined to ensure that we did not see that. In the words of my colleague who did the detailed work, “I bet their evidence is an inch deep and a mile wide, but if we can’t see it, we can’t prove it, and if we can’t prove it, we can’t challenge it.”
We have been told informally over the past year when we have spoken to Newham Council officers that the original estimate of 6,000 landlords was an extrapolation from their understanding of the number of privately-rented properties in the borough and the anticipated average portfolio size of landlords. The true number was as much a surprise to them as any one.
Our understanding is that Newham is treating the licensing scheme effectively as a registration scheme: having identified the landlords who have registered, they do not have any immediate plans to pursue or engage further, preferring to concentrate on finding those who have not registered and taking vigorous enforcement action where they can. We have argued that this is a further indication that licensing was the wrong approach, and that the success that they perceive has been bought at the expense of the alienation of the responsible landlord community, who could have been the Council’s biggest supporters if they were persuaded that the Council was serious in trying to crack down on the criminal landlords but not impose a burden on those who complied with the law. It also frustrates us as an organisation, as we offered to work with them using our landlord development and accreditation schemes to raise standards and give landlords an opportunity to demonstrate their knowledge and competence as an alternative to licensing.
We are aware of a growing number of Councils which have heard Newham’s message of their success and are looking seriously at introducing schemes of their own. It looks as if most of the other North-East London local authorities will introduce a licensing scheme by the end of the year. We scrutinise proposals as we hear of them, and help our local members to put the case against, with some success. The Government responded positively to the Select Committee’s recommendation that the bureaucratic and administrative obstacles to introducing licensing should be streamlined to make it easier, but we have yet to see their proposals as to how they will achieve this.
Personally, I think Newham’s real success, and the aspect of their approach which is most frequently overlooked, is the way in which they have restructured and re-prioritised the Council budget to enable them to ramp up the scale of enforcement action. They had to do this, because the licence fee can only cover the costs of administering the scheme, not dealing with whatever might emerge as a consequence. I wonder how many of the other Councils looking at licensing have realised this is essential to success; I certainly had the impression from one meeting that the councillors (if not the officers) rather assumed that if they introduced licensing, many of the problems they see in the PRS would be resolved almost as a result of landlords having to get the licence. They did not seem to understand the sweep of standards regulation which already applies whether there is a licensing scheme in place or not, nor that the licensing revenues would not cover the accompanying enforcement. I can’t help thinking that in pushing the benefits of licensing rather than enforcement, Newham are actually underselling their real success and not re-building their relationship with their local landlords. Although if they were to do this, it might then beg the question of why they didn’t just focus on enforcement in the first place.
Richard Lambert | Chief Executive Officer
National Landlords Association
Services to Businesses and the Public Sector
We advise a range of organisations including banks, building societies, local authorities, social housing providers, institutional investors and insurers.
We help them develop and improve their services and products for private landlords.
We also write for property portals, speak at property events and we are regularly quoted by the media.
Services for Private Landlords
We help landlords and property investors by showing them how to make money in the private rented sector using ways which are fair to tenants and which involve minimal risk.
HOME PAGE OF THIS BLOG: Blog
THE HOME PAGE OF THE MAIN SITE: http://www.LettingFocus.com
For general information on our CONSULTING SERVICES and also to find a small sample of links to where our comments have been featured in the National Press: Consultancy and Seminars
For ONE TO ONE PRIVATE CONSULTANCY FOR PRIVATE LANDLORDS: Property Advice
CLIENT TESTIMONIALS – from both organisations and private landlords: Testimonials
BUY “SUCCESSFUL PROPERTY LETTING”
Our book is the highest selling personal finance and property book in the UK. Click here to Find Out More and Buy it.
If you are from an organisation and would like to bulk buy, please ask us for special rates.
TO JOIN OUR FREE NEWSLETTER Mailing which goes to over 3,500 people (as at Jan 2013) just send an email to [email protected]
We do not spam or sell our mailing list to advertisers, though we occasionally mail landlords about good products from third parties. Please put us on your “white list” to ensure you receive our emails.
OFFERS ON PRODUCTS FOR LANDLORDS and TO ADVERTISE YOUR PRODUCTS to LANDLORDS: Landlords Resources
PERUSE LAST TEN BLOGS BY GETTING THE RSS FEED: Click Here
NEXT SEMINAR EVENTS FOR LANDLORDS: Landlord and Property Letting Seminar
Copyright of Blog: David Lawrenson 2013. Please link to us here or quote us. We actively pursue copyright infringements. The blog is updated roughly once a week.
TWITTER PAGE My thoughts on property, personal finance, plus a lot of other random things: Twitter
LINK TO THIS BLOG OR TO OUR WEBSITE