Local authority in search of private landlords further afield who can house its tenants

In recent years the Government has hit landlords with extra Stamp Duty and the removal of several tax reliefs, but now it seems officials, at least at a local level, are starting to realise you don’t know what you’ve got until it’s gone.

Vanessa Warwick, of landlord forum PropertyTribes, was shocked to see officials from Croydon Council at the Landlord and Investment Show, 44 miles down the road in Brighton.

It turns out that the council, which introduced landlord licensing in 2015, is facing a shortage of properties for their social tenants.

The officials told Warwick that they are promoting landlord incentive schemes such as rent guarantees to help social housing tenants currently needing accommodation, of which they currently have 736 on their books.

Warwick spoke to Denise Dje Komenan, Shannon Tavernier Gustave and Jojo Blankson from Croydon Council.

Dje Komenan explained that the team was at the event promoting incentives for landlords to rent both in Croydon and to rehouse tenants outside the borough.

She said: “Because of demand we have, we look at neighbouring boroughs and will take properties within the M25.”

Tavernier Gustave added: “There are not so many social housing properties. We are here to get landlords to help provide properties for tenants in need.

“There are 736 tenants waiting to be housed at the moment and every week more forms come in. We are asking landlords for help.”

Blankson was then asked by Warwick if recent Government clampdowns on buy-to-let had discouraged landlords and forced them to search beyond Croydon for people to help.

He said: “We are raising awareness in different areas. For us, coming to places like Brighton, we can go anywhere, we are not confined even to just the neighbouring boroughs. I found myself in Bedford the other day.”

A Croydon Council spokesman rejected suggestions that its licensing scheme had turned landlords away from the borough.

A statement provided to EYE said: “With major public and private sector regeneration, Croydon is a high demand property area. To attract more supply from landlords across the south-east, the council offers initiatives including guaranteed rents and long-term deals.

“We have over 28,000 flats and houses with a Croydon private property licence, and there is no evidence this scheme has caused a dip in supply. Properties outside Croydon don’t need a licence unless the local authority operates something similar.”

Warwick wrote on her website after the interview: “This is deeply ironic, bearing in mind that the Government is actively deterring landlords from investing in the sector by way of increased legislation, fines, Stamp Duty and, of course, Section 24.

“It would appear that the Government has no idea of the reality of what is going on at the coal face.

“If there are 736 tenants in emergency accommodation in just one borough, how many is that nationwide?

“Taxpayers are footing the bill for housing these tenants in emergency accommodation, when it is far less expensive to house them in private sector landlords’ properties.”

She said the video should be shared with MPs to show why private sector landlords need support.

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15 Comments

  1. Will

    This is what happens when rogue councils like Croydon introduce borough wide licensing.  They seem to want to screw landlords and the result is they have screwed themselves. Others should take note that unnecessary over-regulation to raise council funding by the back door back-fires.  Would I invest in any council area where blanket licensing has been introduced or likely to be introduced? NO as it shows the wrong attitude to the PRS. Vanessa, well done in raising concerns of the over-bearing legislation in your interview, even if the points raised were not addressed by those interviewed. Newbie landlord should treat such schemes with care and take professional advice first. I was about to invest in Croydon when I found they were intending to introduce borough wide licensing and as a result invested elsewhere.

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    1. RosBeck73

      Yes, it has been a hammering from all directions – locally and nationally – and I actually find it funny that now, as expected, they come to landlords begging for help. Landlords will give them short shrift. With all the additional charges now placed on landlords we need to go for those with the greatest ability to pay the highest rent. The state will have to look after the people whom we have often taken risks housing. Let’s see how they get on, with their bed and breakfasts. It won’t be long before we have trailer parks in the UK as well for those worst off. And none of this needed to happen. I would add that their so-called incentive schemes are ****. Just guaranteeing the rent – and usually at too low a level – is not enough. They need to guarantee all damage and loss to the landlord of ‘taking the risk’ of housing people some of whom will need what can be euphemistically termed ‘support.’

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      1. MF

        Regardless of the “hammering” from government over recent years, my firm will not rent properties to or via any council or social services dept..  Too many bad experiences – in fact I can’t actually think of a good experience.

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  2. Vanessa Warwick

    Thanks for picking up on this story EYE.

    Croydon are not the only council with a “landlord drought”!

    Homeless families in Peterborough have been living in temporary accommodation for more than a year as they wait to receive a home.

    The city council has seen a 43 per cent increase in the number of households who are homeless or on the verge of losing their homes, rising from 1,109 in 2015/16 to 1,586 in the last financial year. Council housing manager Sean Evans said at the end of August there were just over 300 households in Peterborough in temporary accommodation, compared to 97 this time two years ago.

    He told the council’s Adults and Communities Scrutiny Committee that rising rental costs, benefit changes – including the introduction of Universal Credit – and the so called ‘bedroom tax’ were major factors in this rise. Read more at: http://www.peterboroughtoday.co.uk/news/homeless-families-in-peterborough-left-waiting-more-than-a-year-to-receive-a-home-1-8152380

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    1. JMK

      A representative from Peterborough City Council came to our meeting and asked landlords to take more HB tenants.  Whilst everyone was polite the lady went away with little.  The ‘incentives’ were nothing more than we would expect from a normal market tenant.  PCC has hit landlords with selective licensing and is looking to roll it out over the whole city rather than the current 40%.  At the same time they have a terrible surge in homelessness.  When will they learn??

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    2. Will

      Thank you Vanessa for posting following your article.  I fully understand and realise that there is a housing shortage but it seems less than it was a year ago – perhaps less new migration from eastern Europe due to their concerns over Brexit?  My experience of local councils are often arrogant, bullying and quite often tell tenants to become in breach of court orders (insighting contempt of court) advising tenants to stay until bailiffs arrive when dealing with evictions.  I have also had clients who have had their property handed back with the council having done such a “tosh up” on hand back that the value of their property has been compromised.  They do not pay rents in advance as is standard in the PRS. They retain the right to claw back rents because their benefit recipient has acted criminally and they feel all these actions are acceptable.  As a PRS landlord I do not find any of these actions acceptable.  They will no doubt “suck in” some the virgin landlords or newbies by offering what on the face of it seems a good scheme to the uninitiated.

      They introduce blanket licensing to raise funds for their coffers and after all this behaviour they  ask for PRS landlords to rent to them. For justification on blanket licensing it means you have significant problems in every part of your borough – I am sure the good people in places like Shirley, for example, would not consider their area to be problematic.

      Until there is a Cultural change by local authorities I do not see the PRS liking what they see. Certainly current policy by all political parties to keep hammering the PRS, tax levies and increased red tape is not designed to help those poor unfortunate homeless people. It is designed to drive out small landlords.  I do not condone criminal landlords where council should have concentrated their enforcement efforts with the powers they already had to start with. Sorry  if this sounds like a rant!

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    3. The_Maluka

      Here we are ‘proof’ that the actions of councils are not affecting rental supply.

      “A Croydon Council spokesman rejected suggestions that its licensing scheme had turned landlords away from the borough.”

      And as we all ‘know’ only one in five landlords will be affected by the Section 24 tax.  We know this to be true because the government said so.

      I know landlords in both Croydon and Newham who are anxious to sell because licensing has made renting too onerous and I know many landlords who are declining benefit tenants, particularly those on Universal Credit, because they will not be able to pay the economic rent.

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  3. dompritch134

    The Local authority need to take responsibility for the failure of Housing Benefits payments reaching the landlords.

    They also have to realise that landlords do not like the fact they recommend to tenants to stay put even when issued with a court order to vacate, resulting in £1000s of lost rent.

    As a landlord a will never touch HB tenants again as the council just wipe their hands of any responsibility.

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    1. Mark Walker

      Not necessarily the fault of Local Authorities with the introduction of the Tory flagship benefits scheme – Universal Credit.  Housing Benefit now lumped in as one payment to the tenant and no longer paid direct to landlord or agent – a change that many dss tenants did not ask for.

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  4. MrSerious

    Chickens….roost….?

    As Ms Vanessa suggests, I will be sharing this video with our local MPs asap.  Lobbied them recently about the various “attacks” on the PRS and the certain ramifications – received short shrift from all 3 (our properties are in different boroughs):  “We know best; we have made up our minds; you are wrong; now go away.

    I think that the 3 reps from LB Croydon Housing in the video came across (syntax aside) very well and were most presentable – thank you ladies and gentleman.  They appeared genuinely concerned about the problem, want to see solutions, and are prepared to acknowledge (and promote?) the political aspects (even though Mr Jojo avoided getting too involved in his answer!).

    Excellent work, thank you, kudos to them. And…may I say…sound interviewing by Ms Vanessa – can you please take over the R4 Today programme?

    If nothing else, public, open and practical discussions like this by such professionals may help drum the message into politicians and so-called “experts” who clearly have no idea of reality.

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    1. Will

      As far as the politicians are concerned. I understand arrogance; I have more difficulty with stupidity!

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  5. Deltic2130

    Yep. The obvious is finally being made clear, yet STILL the politicians refuse to see the effects of the attacks on landlords. Not being able to make the link between taxes and homelessness is sheer stupidity.

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  6. jeremy1960

    A year ago, against our advice as letting agent a landlord took on a couple who required housing allowance to pay the rent. Within months we were receiving complaints about anti social behaviour, in the end, the landlord took advice & we served notice which expires this Thursday.

    Just spoken with said tenants who advise that they are not moving because the council have advised them to stay put until evicted!

    Why would anyone consider this type of tenant if this is local authority attitude?

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    1. Will

      Because the councils are looking for virgin landlords who do not know better or take advice from a professional! I am sure there are some  very respectable tenants the council need to house but why take the risk with some councils specially  employing officers to prevent private landlord in succeeding  evicting bad tenants.

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  7. Woodentop

    And which tenants are they trying to house out of their area? From hell comes to mind, the ones that would be another councils headache once the poor landlord has finished with being stuffed.

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