Landlords are an easy target for council

In response to Paul Gatrell’s (Head of Housing and Development Control, Burnley Council) comments: Why is it Burnley Council still wish to force through these measures, when only three landlords in the past five years have been prosecuted and apparently even these prosecutions are related to landlords not being licensed and are not for being a bad landlord?

Sunday, 23rd March 2014, 10:00 am

The council already has adequate legal powers to prosecute and force essential repairs to be undertaken on any poorly maintained property. It at least appears landlords are being made an easy and rather lucrative target and those who are already providing quality housing are now being charged with what amounts in total to hundreds of thousands of pounds e.g. (£850,000) for what seems a veiled attempt to help improve properties in low demand areas in town.

Time and again you see in this paper (and on auction sites), a number of independent estate agents’ valuations for these properties, ranging from £15 to £35k, which should speak volumes to the Housing Department. It should now be painfully obvious to everyone familiar with these areas over the past 15 years that the demand to own, occupy or rent out these properties is extremely low and a very risky investment, with little hope of any significant future indexation or capital appreciation for your investment!

Even some banks and other institutions won’t lend for this type of property anymore, particularly in a “licensing area”. No amount of “licensing” by the Housing Department is going to improve these arrears significantly. In fact, because Trinity Ward and other areas of town (Gannow and Queensgate wards) are also being considered as future licensing areas. This could further reduce the demand to buy and invest in these properties.

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This trend will almost inevitably drive prices down even further in these arrears to the detriment of private owners and potential landlords. Why would any prospective private owner or landlord want to consider buying in these licensing areas and incur these additional costs and risks when other areas in Burnley and particular many other towns don’t feel the need to charge these fees or see fit to punish good landlords?

What the Housing Department hopefully can recognise is that many of these properties are owned privately as well as by potential landlords who have not been persuaded to put good money after bad and don’t want to improve these properties or try to rent them to tenants who, for example, may not look after them or always pay the rent. Many are in receipt of housing benefit which also only pays around £62 to £75 a week. Neither does it always help the majority of landlords who are then being offered up to £20k in grants to invest in this type of property, when these houses would often fail to value up on completion by the same additional investment in this present climate and which still has to be paid back to the council!

What hope do some private landlords or owners have in these low demand areas, without the financial help and legal powers of the council, to do what’s actually required, which is to compulsory purchase and re-develop these depressing and often neglected arrears of Burnley?

Paul Gatrell on behalf of the Housing Department quotes “improvements in property conditions, property management and a reduction in both environmental crime and anti-social behaviour have been achieved” apparently (without giving detail) in support of the last five years of landlord licensing.

Surely the majority of private landlords were never blamed for these problems in the first place, particularly when it’s in the landlords’ best interest to support these efforts.

Unfortunately, Paul Gatrell also chose to use the lowest charging scenario of “one landlord with one property” to highlight the council’s £750 charge equates to a cost for these landlords of £13/month/property. However, the effect on many other landlords who have invested their own money in Burnley, on multiple properties to try to achieve some economies of scale, have now to find many thousands of pounds over the base figure being quoted.

Neither has the total fees, which could still be collected by the council, have not been disputed and could still amount to some £850,000 to allegedly help to manage the suspiciously hard to find or prosecute, bad or rogue landlords. These costs have to be paid for by Burnley landlords by absorbing yet another overhead or passing the cost on to tenants which is becoming increasingly likely!

There is also little benefit in being tempted by the Housing Department’s potential discounts for landlords to become an “Approved Landlord” as this has little to offer an already established and experienced business. Particularly as there could be additional associated costs involved, in getting “Approved” in the first place which would need to be offset against any potential savings being offered under the Selective Licensing scheme.

We don’t want to see or hear in another five years the same statistics and generalisations still being used to perpetuate Landlord Licensing if little had again been achieved by the Housing Department to clear Burnley of these often unsightly, unwanted and low value properties, which seriously detract from the significant improvements being achieved in other parts of the town that Burnley Council and homeowners generally can be proud of!

Pauline Simon

Burnley landlord