12th April 2005

Although overshadowed by the general election, the local elections on the same day will give landlords, Buy to Let investors and letting agents a major opportunity to quiz their local representatives over their attitudes to rental property, regulation and raising revenue, ARLA, the Association of Residential Letting Agents, pointed out today.

The 2004 Housing Act has already passed into law but the secondary legislation has yet to be finalised. This covers the details about licensing of houses in multiple occupation and the issue of selective licensing of ordinary properties in certain areas, as well as the introduction of Tenancy Deposit protection schemes. ARLA believes that election time presents the opportunity for landlords and Buy to Let investors to ensure that licensing and regulation in the private rented sector avoids following parking fines and speed cameras as a contentious revenue-raising issue.

ARLA is in close consultation with the Office of the Deputy Prime Minister about practical, efficient and fair methods for the introduction of licensing, which is scheduled to come into effect during the autumn. However, the implementation of any licensing is down to the local authority and last week the Housing Minister told Parliament there will be no cap imposed on these fees.

"Election time gives everyone concerned with the rental market the opportunity to raise these issues at local level when would-be councillors are in listening mode," pointed out Adrian Turner, Chief Executive of ARLA.

"At the national level, licensing of houses in multiple occupation and the selective licensing of poor quality housing makes sense. The problem lies with the implementation, particularly the control of license fees. There is a very real danger that licensing and regulation in the rental market could become an issue about revenue raising instead of sensible regulation. This is precisely what happened over parking controls and speed cameras."

The new Housing Act 2004 goes to great lengths to redefine which properties will be subject to mandatory licensing.

"Fair enough," said Adrian Turner. "But, the Act goes on to allow local authorities to extend the requirements for licensing so potentially putting the local private rented sector at risk from the whim of a licence fee-hungry local authority. This is especially true now that it has been confirmed that there will be no cap on these fees."

This is where ARLA believes that voters should take the opportunity of the elections to help frame some guidelines and ask their candidates to ensure that licensing in the rental sector is for the wellbeing of tenants and not for revenue raising.

Although selective licensing of ordinary property in areas of low housing demand can be brought in by the local authority to ensure quality standards of living, there has to local consultation and specific approval from the Secretary of State.

"However," warned Adrian Turner, "As with parking, we all know of local councils who will find excuses to target sectors of society to raise revenue without any specific need. Housing costs must be contained, and the electors have a real chance to help us do that."

"ARLA does not believe that the regulatory burden is high. Most landlords do everything - and often much more - than government legislation would ask of them. But we must control costs in the private rented sector. Otherwise, it is the tenants who will pay while the difficult targets, i.e. the rogue landlords will carry on providing poor housing and will be ignored in the rush for easy revenue from the soft targets. These are the good, compliant landlords and the regulated letting agents," added Adrian Turner.

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