Agenda item

The Cabinet gave consideration to a  report of the Executive Director Place and Economic Growth which sought approval of a Selective Licensing Scheme to implemented in certain parts of the Borough.

It was reported that an extensive period of consultation had been carried out regarding the introduction of a second selective licensing scheme for privately rented properties in parts of the Borough.

The report detailed the findings of this consultation and also developed the final proposals for a second selective licensing scheme.

In 2015 Oldham Council introduced a Selective Licensing Scheme for privately rented properties in certain parts of the Borough as an intervention to address issues of low housing demand. It was a five-year scheme that ended in December 2020.

A review of the scheme was completed May 2019 and updated December 2020, which showed low housing demand had improved in some areas, had stayed the same in others, and had deteriorated in 2 areas. It also identified additional areas which are exhibiting low housing demand.

In January 2020, following Cabinet approval, a statutory consultation for proposals of introducing a new Selective Licensing Scheme commenced and this consultation was relaunched again in January 2021 due to the impact of the Covid pandemic both on the responses to the consultation and the resources available within the Council.

The private rented sector performs an essential role in the Borough’s housing market.  Many private landlords provided a decent service to their tenants, but the practices of some can give the sector a poor reputation and affect the housing demand of an area.  Selective licensing can form a part of a wider set of measures to address the causes of low housing demand.

The Housing Act 2004 included provisions to develop an improved and more professional private rented sector.  Section 80 gave powers to local housing authorities to designate areas as subject to selective licensing in respect of privately rented accommodation, provided certain conditions are met.  A review of the housing market was carried out in 2019 and updated in 2020 which indicated there was evidence of low housing demand in the proposed areas.  The report explained how selective licensing would support a range of measures to tackle the problem. 

From the consultation exercise, private landlords had expressed their concerns;

1)    that the introduction of a new licensing scheme is not required

2)    that the housing market has changed

3)    they are unclear on what the previous scheme has achieved and how any new scheme would make a difference. 

Other consultees had stated that licensing should be introduced across the borough.

The report acknowledged the feedback from the consultation and sought to address the concerns.  It was clear that different stakeholders had different opinions, and there is no way of achieving an outcome that is satisfactory to all.

Other options had been considered to address problems in the private rented sector, however these were too narrow in addressing management standards and do not provide a holistic, strategic response to raising management standards.

Selective licensing could be an integral part of the Council’s wider housing strategy, by improving management standards. Managed well, the private rented sector can offer choice and flexibility within the Borough’s housing market with the potential to support economic growth as well as meet housing needs.

The implementation of Selective Licensing does have risks; however, these have been carefully considered.  The Council has experience, knowledge, shared best practice and learning from the previous scheme that would greatly benefit any new scheme. 

Options/alternatives considered

Option 1 – To consider the findings of the review, consultation, options appraisal and other measures available to work with Selective Licensing and to approve a two-phase approach to implementing a new Selective Licensing scheme, starting with the LSOAs with the worst low housing demand.

Approve the licence fee cost for phase 1 of the selective licensing scheme at £582 per property.  The fee is split into two payments, an application fee of £340.34 and a monitoring & compliance fee of £241.66. 

Option Two - Approval of the first phase only of a new Selective Licensing scheme in the LSOAs as stated in (Appendix 13) affecting 17.36% of the private rented sector.

Approve the licence fee cost for phase 1 of the selective licensing scheme at £582 per property.  The fee is split into two payments, an application fee of £340.34 and a monitoring & compliance fee of £241.66. 

Option Three - Approval of a new Selective Licensing scheme in all the LSOAs that have been statutorily consulted over 20% of the private rented sector and apply for Secretary of State Approval.

Option Four - Not approve the use of Selective Licensing in Oldham.         

RESOLVED – That

1.    The findings of the reviews and outcome of the statutory consultation be noted.

2.    A two-phase Selective Licensing approach be approved.

3.    The license fee cost for phase 1 of the selective licensing scheme at £582 per property be approved. The fee would be split into two payments, an application fee of £340.34 and a monitoring & compliance fee of £241.66. 

4.    It be noted that Phase 2 of the proposal, which involved a further period of consultation and the resultant recommendation potentially being approved by the Secretary of State would require a further budgetary provision of £25,000.