Selective Licensing Scheme Private Sector Housing Agency

Madeline Jeffery – Assistant Director of Housing

Nick Stabeler – Private Sector Housing Agency Manager

Gemma King – Project Manager

Ella McCarthy – Housing Policy and Data Analyst

George Hallam – Projects Coordinator

Karen Kemsley – Data Scientist

Recommendations

• Committee are asked to:

– Comment and note the progress of the work to

develop an application for a borough wide licensing

scheme. This report will be submitted to the Mayor &

Cabinet in April 2019;

– Support the commitment to undertake a public

consultation on the proposals to submit an all borough

licensing scheme.

– Note the £400k upfront budget commitment needed if

an all borough scheme is approved. This will be fully

recovered from the licence fee.

Where are we starting from?

• Manifesto Commitment to Corporate

Priority February 2019

• Current system – Mandatory and Additional

Licensing Scheme

• Other Boroughs

Objectives

Corporate priority to deliver a borough-wide landlord

licencing scheme

• Help tackle the housing crisis

• Improve standards in the private rented sector

• Crack down on rogue landlords

• Improve security, stability and decency for our residents in the PRS

• Help tenants feel safe in their homes through advice, support and

effective enforcement

• Support local landlords during and after the 5 year scheme

• Inspect 100% of all licenced properties over the term of the scheme

Selective licensing: Secretary of State

approval

Selective Licensing of Houses (Additional Conditions) Order

2015 states licensing can be used in areas with high private

sector housing where the area is experiencing one or more

of the following:

• Low demand – not relevant in Lewisham

• High Anti-Social Behaviour

• High migration

• Poor housing conditions

• High levels of deprivation

• High level of crime

Selective licensing: Secretary of State

approval

The application must:

• show how licensing will have an impact on problems within

the PRS

• form part of the council’s housing strategies, including

homelessness, regeneration, ASB and empty homes

• set out the role that the Police and Social Services will play

• consider alternative courses of action that might provide an

effective remedy

Programme milestones

Data analysis

Operational plan

Approval from Mayor and cabinet

Public consultation

Submit to Secretary of State

Secretary of state approval

12 week lead in time

Completion end of March 2019

Drafted; to be finalise by April 2019

April 2019

May – August 2019

February 2020

November 2019

By

May

2020

Support required in

sharing consultation and

encouraging responses

Data analysis

Review of other boroughs with large licensing schemes &

consultation with MHCLG has informed analysis process:

1. Establish up-to-date numbers of PRS properties

- bringing together 35+ datasets

- applying predictive analytics techniques

- validating results through street surveys

2. Investigate relationship of PRS with issues specified

in the guidance

- presenting results to-date of Deprivation, ASB and Crime

Establishing the size of the PRS

Establishing the size of the PRS

Owner Occupier Private Rented Social Rented

63k 31k 34k

49% 24% 26%

Establishing the size of the PRS

Data analysis

• Review of other boroughs with large licensing schemes &

consultation with MHCLG has informed analysis process:

1. Establish up-to-date numbers of PRS properties

- bringing together 35+ datasets and applying predictive

analytics techniques

- validating model through street surveys

2. Investigate relationship of PRS with issues specified

in the guidance

- presenting results to-date of Deprivation, ASB and Crime

Deprivation

A designation can be made if :

• High levels of deprivation compared to region

• High proportion of housing is in the private rented sector

Deprivation factors to consider:

• the employment status of adults,

• the average income of households,

• the health of households,

• the availability and ease of access to education, training and other

services for households,

• housing conditions,

• the physical environment and

• levels of crime.

Indices of Multiple Deprivation

Indices of Multiple Deprivation –

breakdown by Index and Ward

Deprivation and PRS

Anti-social behaviour

• A designation can be made if significant and persistent anti-

social behaviour (ASB) occurring within the immediate vicinity

of a property

• Includes intimidation or harassment, noise, rowdy and

nuisance behaviour, animal and vehicle related nuisance, anti-

social drinking, drug taking or dealing, graffiti and fly posting,

and litter and waste

Anti-social behaviour patterns

Anti-social behaviour persistence

Anti-social behaviour and PRS

Anti-social behaviour and PRS

15% of PR properties

have an ASB incident

recorded within 10 m

28% of PR properties

have an ASB incident

recorded within 25 m

Both %s higher than

other tenures

Multiple incidents also

more likely to

affect PR properties

Crime

• Crime can be considered as a designation reason if there has

been:

– a recent increase in the levels of crime,

– whether the crime rate is higher than other areas or

– if the crime rate is higher than the national average.

• Can only be used if a high proportion of housing in areas with

high levels of crime is in the private rented sector

• Consider the nature of the criminal activity (e.g. theft, burglary,

arson, criminal damage, graffiti)

Crime Patterns

Crime Comparison with National Rate

Crime Comparison with National Rate

Crime and PRS

Conclusions

• Estimated 31k Private Rented properties in Lewisham

• Most Wards comprise 19% or higher Private Rented properties.

Downham is the exception.

• There is high Deprivation across the borough, even when

compared with other London boroughs

• ASB rates are high and persistent in 5 Wards; PR properties

are more likely to have a reported ASB incident in the vicinity

of their property than other tenures, and multiple times

• Crime rates are higher than the national rate for 6 Wards

overall, and all Wards for some crimes.

• Relationships have been established between PRS

and Deprivation, Crime and ASB.

• These results form the basis for the separate designations

within the application

Designations: Initial splits, likely to change

Ward PRS % Deprivation Crime ASBInitial

Designation

Bellingham Y Y Y Y 1

Brockley Y Y Y Y 1

Lewisham Central Y Y Y Y 1

New Cross Y Y Y Y 1

Rushey Green Y Y Y Y 1

Blackheath Y Y Y 2

Catford South Y Y Y 2

Crofton Park Y Y Y 2

Evelyn Y Y Y 2

Forest Hill Y Y Y 2

Grove Park Y Y Y 2

Ladywell Y Y Y 2

Lee Green Y Y Y 2

Perry Vale Y Y Y 2

Sydenham Y Y Y 2

Telegraph Hill Y Y Y 2

Whitefoot Y Y Y 2

Downham Y Y 3

Operationalisation

• Selective Scheme (25,000 properties)

• Extension to Additional Licensing (6,000 Properties)

– To ensure full coverage of the borough for all HMOs

– HMOs are the highest risk premises and require more

robust inspection and enforcement

– Administrative cost is greater and the fee must reflect

this

– A different set of conditions that reflect the nature of

the premises

– Helps stage the implementation of the wider scheme

– Reduces illegal evictions because of occupancy levels

Management – Selective scheme

• We estimate that we will need an additional 56.25 FTE for the borough-

wide scheme (7 of which will be apprentices)

• Further work is being carried to assess the impact of the additional licensing scheme on

staffing requirements and fees

• These numbers will reduce over the 10 year period (5 years licensing

and 5 years administering the remaining licenses);

• The overall cost for a full borough licensing scheme over 10 years is

estimated at £17.3M

Staff Year 1 2-5 6-10Admin 26 7 2Inspector 13 13 7Manager 3 2 0Lawyer 1 1 1Project Manager 1 1 1Project Officer 4 4 0ASB Officer 1 1 0Data analyst 0.25 0 0.25Apprentices 7 7 0

Fees and comparisons

• The licence fee must

be based on the cost

to administer a licence

• Separate enforcement

fee can be charged at

issue of licence

Council Fee

Brent £540

Croydon £750

Ealing £500

Hackney £500

Hammersmith and

Fulham

£500

Havering £550

Newham £750

Redbridge £500

Southwark £500

Tower Hamlets £520

Fees

• We propose to base the fee on the council tax

band for the property

• Projected income over 5 years is £17.5M

BandPercentage of properties

in LewishamProposed Fee

A 6.10% £575.00

B 27.43% £600.00

C 35.25% £625.00

D 21.48% £650.00

E 6.13% £675.00

F 2.34% £700.00

G 1.11% £725.00

H 0.15% £750.00

Costs v Income

• Any excess income will be used to provide ongoing training and

support to landlords

0.00

2,000,000.00

4,000,000.00

6,000,000.00

8,000,000.00

10,000,000.00

12,000,000.00

14,000,000.00

16,000,000.00

18,000,000.00

20,000,000.00

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Income vs Costs

Cumulative costs Cumulative income

Support and input from partners

Secretary of State Referral

• MHCLG – Positive relationship established; they are

keen to guide us to a successful outcome

• To maximise chance of success we will submit

multiple designations:

• One for borough-wide

• One broken down to ward-level to allow partial success if

borough-wide is declined

• Estimated 8-12 week turnaround but our developing

relationship with the MHCLG advisors could shorten

this

• 3 months statutory minimum before we can implement

scheme