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Agents warned by NALS as new civil penalty regime comes into force

6th April 2017

New legislation which came into force on Thursday 6 April gives local authorities in England tough new powers to crack down on rogue landlords and agents.

For the first time, local housing authorities will be able to impose a civil penalty of up to £30,000 for a range of housing offences, including:

  • Failure to comply with a housing improvement or overcrowding notice;
  • Failure to have the correct licence for a property that needs a mandatory HMO, additional or selective licence; and
  • Failure to comply with the HMO management regulations.

When it comes to properties that don’t have the correct licence or breach management rules in Houses in Multiple Occupation (HMOs), both the landlord and letting agent can be held liable, making compliance checks more important than ever.

Before imposing penalties, local authorities must have regard to government guidance, issue a notice of intent and invite representations. There is also an appeals process.

In a further development, the government has expanded the Rent Repayment Order (RRO) provisions that enable the local authority or tenant to claim back up to 12-months rent.

Previously, this power was only available in relation to licensable but unlicensed properties and tenants could not lodge a claim unless the local authority had prosecuted the landlord.

From 6 April 2017, RROs are available as a sanction for a wider range of offences including:

  • Illegal eviction or harassment of occupiers;
  • Using violence to secure entry; and
  • Failure to comply with a housing improvement notice or prohibition order.

Tenants will now be able to submit a claim without the local authority having prosecuted the landlord and the local authorities has the power to assist them.

Unlike criminal prosecutions, any income received from civil penalties and RROs can be retained by the local authority and spent on certain housing enforcement activity.

Isobel Thomson, Chief Executive of NALS said:

“Whilst we support local authority action to crack down on rogue landlords and agents, it is vital that councils resist the temptation to issue financial penalties for very minor infringements purely to raise income and fill their budget black hole.

“If used wisely, these powers could mark an important step forward in driving rogue operators from the market and improving consumer protection.

“With councils able to retain revenue from targeted enforcement action, the business case for introducing new bureaucratic and costly licensing schemes is weaker than ever. It is time for councils to think again and adopt a smarter approach to regulation”.

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