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Scrutiny Intensifies Over Council HMO and Selective Licensing Schemes

A new investigative report spearheaded by industry expert Kate Faulkner and compliance platform Yuno has cast a spotlight on the efficacy and equity of property licensing schemes managed by councils. The study scrutinises selective and HMO (Houses in Multiple Occupation) licensing, questioning their impact on both the private rented sector’s standards and the financial burden they impose on agents and landlords.

The Debate Over Licensing Costs and Outcomes
The report, resulting from collaboration between Yuno and Kate Faulkner, a respected figure in the property industry, challenges the prevailing narrative around property licensing. While councils and advocacy groups have championed selective licensing as a tool for uplifting rental standards, the report highlights concerns over the schemes’ cost-effectiveness and their real impact on poor-performing landlords.

Yuno’s research indicates a significant variance in the adoption of additional HMO and Selective Licensing schemes across England and Wales, with a quarter of English local authorities and over a third in Wales implementing these measures. Despite acknowledging recent improvements in rental home quality, the report questions the justification for steep licensing fees, which can reach around £1,000.

Disparities and Government Challenges
The timing of Yuno’s findings coincides with governmental efforts to introduce a national landlord portal through the Renters (Reform) Bill, a move that could potentially render selective licensing schemes obsolete. Paul Conway, CEO and Founder of Yuno, notes the uneven regional distribution of these schemes and contrasts this with the geographical prevalence of non-decent homes, raising doubts about the schemes’ effectiveness in elevating housing standards.

Notably, the report uncovers significant disparities in licensing fees among London councils, with some charging up to twice as much for the same licenses. This inconsistency leads to further scrutiny over the rationale behind the varied fee structures.

A Forward-Looking Dialogue
In response to these findings, Yuno, with Faulkner’s support, plans to convene a roundtable discussion aimed at assessing the real benefits of these costly licensing schemes in improving housing quality. This initiative reflects a growing call for a more equitable and transparent approach to managing the private rented sector, ensuring that measures to uplift standards do not unduly penalize the industry’s good actors.