Why has HMO Licensing in Cathays been extended? | CPS Homes

Why has HMO Licensing in Cathays been extended for a further five years?

County Hall on Atlantic Wharf

Cardiff Council has announced the extension of its Additional HMO Licensing Scheme in Cathays for a further five years - effective from 1st January 2016.

Originally introduced in July 2010, the initial scheme ended in July 2015, but the Council has decided that the standard of HMO housing in the area has not yet improved to the desired level, so have taken the decision to extend it until 1st January 2021.

The news means that landlords will be required to pay around £275 to renew their existing HMO licence when it expires. Applications for properties that have no such licence in place already will cost in the region of £660.

A "disappointing" decision

The Association of Residential Letting Agents (ARLA) has expressed its dismay at the decision, stating: "it is disappointing that Cardiff Council did not take into account the points made during our opposition to this scheme."

In a letter dated 26th June 2015, ARLA composed a response to the Council’s public consultation on the proposal to re-declare Cathays as an Additional Licensing Area, questioning both their logic and reasons.

The Council’s own consultation document stated that the initial licensing scheme has improved the quality of accommodation, health and safety standards and value-for-money in the area.

Additionally, it said it has provided sustainable improvements to the Cathays area; a consistent approach to tenancy management and property conditions, made improvements through landlord training; eradicated bad landlords; reduced anti-social behaviour; and assisted with the availability of information to the local authority, so the decision to extend the scheme appears a surprising one.

Has the extension been made lawfully?

ARLA also questioned the Council’s lawful ability to recreate the licensing scheme. In order to create an Additional Licensing designation, the Housing Act 2004 states:

"The authority must consider that a significant proportion of the HMOs of that description in the area are being managed sufficiently ineffectively as to give rise, or to be likely to give rise, to one or more particular problems either for those occupying the HMOs or for members of the public."

With the Council’s consultation document making no reference to any such problems - it painted quite the opposite picture, in fact - the strength of the evidence they provided in order to pass the legal requirements necessary to grant an extension to the scheme is surely arguable.

Will the new scheme be handled any differently?

The Housing Act 2004 goes on to state that local authorities can only implement additional licensing schemes where "they consider that making the designation will significantly assist them to deal with the problem or problems."

So, if the first Additional Licensing designation didn't lead to a reduction or elimination in the issues the Council want tackled, what evidence is there to suggest that its reintroduction will have a different result? We’re yet to see any! As far as we're aware, the scheme will be managed no differently in the next five years to how it was in the first five years.

As such, ARLA argued that the Council’s position was either;

  1. The original scheme was successful (as indicated in the consultation document) and therefore the legal basis for the creation of a new scheme does not exist; or
  2. The original scheme was not successful and therefore there is no evidence to suggest recreating the scheme will have a different effect.

In either situation, ARLA believed the Council would not be able to provide the necessary evidence to support the legal creation of an Additional Licensing designation… but they did, and the decision is now set in stone.

Rent Smart Wales

Finally, ARLA urged the Council to consider the implications of creating another licensing scheme when the Welsh Government is currently in its final stages of implementing its nationwide agent and landlord licensing scheme, Rent Smart Wales.

Cardiff Council has been appointed to administer Rent Smart Wales, which has broadly the same aims as this proposed Additional Licensing designation, but on a more ‘per landlord’ than ‘per property’ basis.

ARLA claimed it would be "illogical" to create another licensing scheme so shortly before the introduction of Rent Smart Wales, unless the Council does not believe the nationwide scheme will be successful. They asked that Rent Smart Wales be implemented and properly evaluated before creating potentially an entirely unnecessary secondary layer of local licensing, but the request appears to have fallen on deaf ears.

If you have any queries or concerns over the reintroduction of Additional HMO Licensing in Cathays, please feel free to get in touch with Sophie Green at CPS Homes on 02920 668585 or sophie.green@cpshomes.co.uk.

28 October 2015


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