Peterborough buy to let investors have claimed that they can no longer afford to carry out necessary repairs on their rental properties following the introduction of the borough’s selective licensing scheme.
Peterborough City Council introduced selective licensing last year in an attempt to tackle rogue landlords. However, many felt that the scheme would have a detrimental effect on property supply in the area, fears that have since been affirmed and have led to the Council having to step in after several landlords said that they were considering withdrawing from the rental market.
The council is now offering landlords ‘repairs assistance,’ enabling them to lease their properties to the authority for at least five years, with the council then transferring rent from the tenant to the landlords, removing 20 per cent for management and maintenance costs. This aims to reduce homelessness in the area.
A council report states: ‘The introduction of selective licensing in September 2016 has seen some private landlords indicate that they cannot afford to carry out necessary repairs to their properties or meet licensing requirements and are considering withdrawing from the market.’
The selective licensing scheme covers nine wards: Central, North, East, Park, Fletton, Bretton North, Stanground Central, Walton and Orton Longueville and econompasses around 37 per cent of the city’s private rented stock.
Landlords who are part of a nationally accredited landlord/letting agent association pay £50 per property for each five-year licence, a fee which rises to £600 for non-accredited landlords and £750 for a house of multiple occupation.
Many landlords are against the scheme, which was supported by MP for Peterborough Stewart Jackson, as they feel that certain conditions stipulated in the rules will lead to homelessness, such as room size conditions. However, the council said that over 900 gas safety certificates were issued in the month before the selective licensing deadline. This suggests a need for the scheme in that many properties were without a certificate, despite it being a legal requirement.