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Additional Licensing in Cathays Landlords

Definitions

For a list of definitions regarding additional licensing of HMO properties in Cathays please see HMO Additional Licensing Definitions.

Landlords

This section should answer questions landlords have about licensing, and how it affects them. Remember licensing has the following aims:

Level Playing Field
Improvements in housing and management standards
Consistency in Approach
Engagement with Landlords
No way out – blanket scheme for HMOs
Suitability of owners – fit and proper licensees
Involves all partners – landlords, agents, tenants, police, fire service, council, etc.
New Strategic approach in the Cathays Community Ward
Generating a thriving rented sector

The Council wants to use additional licensing to encourage and promote professional landlords. For the less capable landlords who do not deal will their rental properties appropriately, licensing can force them to improve property conditions and standards of management. Where landlords are not fit and proper to deal with their HMOs, the Council can insist that management is passed over to someone more suitable. Licensing will therefore make a fairer environment for people renting in the Cathays Community ward, and encourage a flourishing sector.

Who should apply for a licence and by when?

Once the additional licensing scheme comes into place on the 1 July 2010, owners of Houses in Multiple Occupation (HMO) in the Cathays Community Ward of Cardiff must apply for a licence. The definition of a HMO can be found in this pack. If you are a resident landlord in the area, please make sure you read the definition carefully, as having a certain number of lodgers could mean you will need to apply for a licence.

Application forms can be filled in by anyone but must be signed by the proposed licensee and manager. One named person will hold the licence. The licensee is generally an owner of the property (the freeholder or any other owner or lessee who ultimately receives the rent). However, during the application process all owners, managing agents and interested parties (e.g. mortgage companies) concerned with the property must be declared.

Are there instances where the licensee would not be an owner?

The most appropriate person to hold the licence tends to be the person who has the authority to ensure compliance with the licensing conditions, and there is a presumption in the Housing Act 2004 that this will be the owner. However, if the council does not consider that he or she is suitable to hold the licence e.g. because they are not “fit and proper” or perhaps they are elderly, ill or living abroad, it can agree that the licence be held by someone more appropriate, such as a managing agent.

Once I have applied for a licence, what happens next?

It is very important to make sure that applications submitted are complete, including all enclosures, or you could face court proceedings for noncompliance with licensing rules. Once a satisfactory licence application is received by Private Sector Housing, you will have met your  obligation to licence a HMO.

The licensing process normally involves the following steps:

· We write to confirm we have a complete application
· A licensing officer will inspect the HMO
· A draft licence and conditions is sent out to all interested parties
· A two week period is allowed for representations to be made
· The Council will consider any representations made, and then a formal licence and conditions is issued.
· Licenses will contain conditions which need to be met by the licensee within certain timescales. The Council will visit to ensure compliance.
· Licensees will need to ensure on-going compliance with their conditions.

Licenses will be granted if:

· the applicant is a fit and proper person and the most appropriate person to hold the licence;
· the proposed manager has control of the house, and is a fit and proper person to be the manager;
· the management arrangements are satisfactory; and
· the house is reasonably suitable for occupation, or can be made so by imposing licence conditions

What happens to the occupants living in the building at the time the licence is granted?

The council must ensure that a licensed HMO is not overcrowded and has suitable shared facilities for the number of permitted occupiers. When the licence is granted there may be more occupants living in the HMO than are permitted to do so under the licence. You will not normally have to evict the existing occupiers. Instead, when tenants move on, it will be an offence to allow new ones to move in if that would exceed the maximum number allowed.

Are licences transferable?

No. When the licence holder of an HMO either sells the HMO or ceases to be the most appropriate person to hold the licence, the new manager will need to apply for a new licence.

What if I want to use a managing agent to manage my property?

There is no problem with this, but the owner will still be the licensee. The Council strongly recommends that you use a regulated agent (one that is a member of ARLA, NALS, NAEA or RICS) so that you do not leave yourself open to financial hardship or claims should things go wrong.

Reputable agents should also be checking that HMO licence applications have been made for properties they advertise that fall within the licensing scheme. If an agent is found to be managing a licensable HMO where an application has not been made, they themselves might be prosecuted.

I have a number of licensable HMOs in the Cathays Community ward; do

I have to make an application for them all?

Yes, an application must be made for each property you own, and the fee will have to be paid for each application. However, inclusions such as Disclosure Scotland Certificates and passport photos only have to be submitted once.

We understand that for some landlords the additional licensing scheme will have a large financial impact. In these circumstances, where landlords are upfront with the Council and declare all their licensable HMOs, we will discuss payment options and a compliance timetable.

The Council wishes to use licensing to force poor landlords to improve - but how will you identify such landlords?

All licensable properties will be inspected to identify issues with management and property standards. In addition all licensees must submit a Scots Disclosure Certificate to substantiate their fit and proper person status. These are easy to obtain and should pose no barrier for suitable landlords, but can highlight issues with less reputable ones. These are then assessed in conjunction with internal Council checks and Wales wide Council checks on relevant prosecutions such as housing and fraud, etc. 

As additional licensing is in one small geographical area, it will also be easier for the Council to target all houses that need a licence but have not yet applied.

What if I decide I don’t want to join the licensing scheme?

Joining the scheme is not optional. There are heavy penalties for landlords that don’t apply for a licence promptly. It will also become increasingly hard to advertise your property as agents, universities and tenants will not use your HMO if you haven’t applied.

Operating a licensable HMO without a licence is a criminal offence and can result in a fine of up to £20,000 upon conviction. Your tenants may apply to the Residential Property Tribunal (RPT) for the return of any rent money they paid while the property wasn’t licensed. You can’t use section 21 procedures to evict tenants.

If the Council is unable to grant a licence or a licence is revoked, the Council must make an Interim Management Order (IMO). An IMO transfers the management of the HMO with the Council for up to 12 months, and this may be extended for a further 5 years by making a Final Management Order.

So what else might I need to know?

Another thing the Council wants to achieve through licensing is to share information and best practice with landlords so they can run their business correctly.

We do this with the Landlord Accreditation Wales scheme which focuses on landlord skills. The landlord attends a one day training session that covers all the key information needed when dealing with tenancies. But don't just take our word for it; see what landlords are saying...

"A very enjoyable and educational course."

"A valuable resource which I would recommend to other landlords"

It will be a condition of the Additional Licensing Scheme that all licence holders attend training, and the best way to achieve this is through Landlord Accreditation Wales. There is a £100 discount off every licence fee for each landlord who gets accredited up front. 

Being an accredited landlord is beneficial not only in terms of business and reputation. It also means that the Council has less need to get involved when an issue arises as you will have the skills and knowledge to sort out problems yourself. You receive a handbook to complement the training, and an accreditation certificate and stickers, etc to promote your business. Also the scheme is Wales wide, so the accreditation accolade can be used on your properties across the Country.

Visit www.welshlandlords.org.uk for useful links, news, downloads and other information. The site also advertises all the events, such as landlord forums, where landlords can keep up to date with information, and chat and share experience with other landlords.

But what about tenants, what are you doing to encourage them to be considerate renters?

The Council recognises that a large proportion of the tenants in the Cathays Community ward area are students. Through joint working with the Universities, the student liaison officer Kieran McCann has launched www.cardiffdigs.co.uk, a one stop website for student housing and living needs. It contains useful information and practical tips about living in private rented accommodation including in-depth information about:
· Things to do as soon as you move
· Ground rules and tips for shared living
· Rubbish and Bin Days
· Maintenance
· Home Safety
· Living in the property
· Useful contacts and other sections

Please contact PrivateSectorHousing@cardiff.gov.uk for a free poster – ‘You’re in – now what’ that you can put up in your HMO to let tenants know about these issues.

Contact Details

The Licensing team are here to help all Landlords, agents and tenants with understanding and implementing Additional Licensing. If you have any questions or queries about the scheme please contact us at the following address and telephone numbers:

Private Sector Housing,
Cardiff Council
Room 139,
City Hall, Cardiff,
CF10 3ND
Telephone Number: 029 2087 1762
Email: PrivateSectorHousing@cardiff.gov.uk
Web: www.cardiff.gov.uk/privaterent

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