How can councils get the best out of their PRS toolkit Part 2

Business People Shaking Hands With Partnership 2022 05 23 12 43 48 Utc

When we first asked this not so rhetorical question* we touched on the partnership work that many councils are now successfully doing within communities and across organisations to get better outcomes for residents. But we also thought that councils needed to do more to bring private rented sector landlords on board - persuading them to get with the programme so to speak. One of the major barriers to this is that the landlord “community” is very disparate, made up as it is of millions of individuals many of whom may not even be local to where their rented out asset is located.

But, at a time when the UK housing multiverse seems to be overflowing with madness, how can this be achieved? We’re currently seeing increasing advocacy for rent and utility bill payment strikes or boycotts by tenants; tenants in coastal towns (and elsewhere) being evicted so that properties can be turned into lucrative holiday lets and thus shrinking the local availability of long term lets; both the property press and housing charities either amazed or shocked at the sky rocketing level of rent increases across the country (a problem of poor supply versus huge demand) with such increases themselves feeding into inflationary pressures; rental reform quite possibly delayed due to Westminster politics and a slew of local authorities possibly about to really run out of money without help from central government.

Some recent quotes from local authority leaders are instructive:

Quoted in the Municipal Journal (3 August 2022) Tom Riordan, Leeds City Council chief executive said of a near £20 million funding gap “it won’t be sufficient for the Treasury to allow us to increase council tax” as struggling residents would not be able to bear the increase.

Carolyn Downs, chief executive at Brent council said “... there is no more discretionary spend left to cut.”

An unnamed chief executive stated bluntly “there is no [more] low hanging fruit” to cut.

And these aren’t simply opinions, they are basic arithmetic (albeit in the millions).

So, what to do, when the headwinds are turning into a maelstrom? What could be a big win for local authorities in getting landlords on board would be to invite the right people to one of the regular landlord forum meetings that authorities often put on for landlords every 3 to 6 months or so (perhaps not all authorities). Although only a relatively small percentage of local landlords ordinarily attend these events perhaps there’s a way to change this.

Recently buy to let mortgage provider Paragon Bank accepted that lenders will need to do more to support landlords in complying with new energy efficiency requirements due to come into effect in a few years. The bank published a report “The Rental Sector Energy Challenge” which showed that over 40% of private sector landlords are unaware that new regulations on energy efficiency will soon be coming into force. This being the case, the argument is that lenders will need to come up with the right “green” financing products that will get many in this cohort of landlords across the regulatory line between 2025 and 2028. If landlords might be more willing to make time for a professional buy to let finance provider than they would a council officer talking about domestic waste disposal of a week-day evening wouldn’t it be worthwhile local authorities partnering with such lenders to spread the word amongst the landlord community. Afterall, if the local authorities where the private rented stock is located don’t head this issue off at the pass then they will incur more officer resource expenditure in the near term dealing with an avalanche of compliance activity and enforcement actions once the new MEES regulations come into effect. The average private sector housing team, working with its leadership, is well placed to build this type of relationship on a local authority’s behalf.

At the same time, council officers need to be engaging with landlords on the issue of tenancy sustainability given what appears to be coming down the pipeline in cost of living terms from late 2022 through early 2023 and onwards. In homelessness prevention teams, private sector housing and selective/HMO licensing teams the knowledge base is there and there are boots that can be put on the ground but, there isn’t much time between now and the recession. The landlord audience is there, they just need to be reeled in with the right offer.

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