Rent Rises – landlords will need to pass on the costs of licensing just as the petrol companies pass on tax rises, and this means a £5 a week rent rise on average. This amounts to an extra Tax on Tenants from Durham Council at a time when tenants can least afford it!.
Evidence from Nottingham (a city wide Selective Licencing scheme about half the size of Durham’s) shows significantly more landlords than expected applied for exemptions as they were selling. Rent rises have been the highest in the country at 5.9% - twice as high as London! (according to Zoopla). Also, according to Nottingham council, homelessness rose 117% by December 2019.
Inspections – Selective licensing gives local authorities the right to inspect a property at any time and also requires regular landlord inspections
(MHSLG selective licensing review 2019).
Many tenants may still be shielding and not all tenants want to be regularly inspected by their landlord or the council. One good example is those with Autistic children who can be severely distressed.
Overcrowding - SL licences require names and ages of everyone living in a licenced property to be provided. Councils can set limits to the number of people who can live in a property based on the number of bedrooms and can set minimum sizes for bedrooms to be counted, for example 6.51 square meters for an adult or child over 10.
This means that a family who are perfectly happy with their home even though the 3rd bedroom is a bit small or who have another child may suddenly find themselves categorised as living in an overcrowded property. The Landlord could have to give them notice if the license forbids allowing overcrowding - even though both Tenant and Landlord want the Tenant to stay in their home.
References – Some tenants (e.g. tenants on benefits, Students/Young People looking for their first rental or those moving back from living abroad) may be unable to provide written rental references for the last 5 years and therefore are now unable to move property.
Council references can take so long that the property is taken by another tenant.
Landlords will be more selective about the tenants they consider to reduce risk.
Homelessness - Landlords may decide to sell or if in negative equity be repossessed (house prices in North East rental areas are often lower than in 2007), further reducing the number of rental properties available.
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