What are the success factors for property licensing schemes?

Lots has been said and written about property licensing as a policy intervention, however there has been little discussion on why some schemes are perceived as a success and why others have struggled.

Over the last 10 years I have managed large and small licensing schemes and keenly observed the progress of many other schemes across the UK. From these experiences I have boiled down the key strategic factors that I believe drive success. There may well be others, but here are my top 10.

Clear political and organisation vision for licensing is essential. Right at the start, local authority (LA) policy makers and stakeholders should develop clear objectives for licensing and stay focused on delivering that vision. LAs that achieve this often have success. Measuring the outcomes of licensing is notoriously difficult, mostly because of confounding factors that make it difficult to isolate the true effect. However, setting and measuring clear and plausible expectations at the top helps drive a scheme forward.

Sound leadership and planning are a must. Setting up and delivering a large licensing scheme requires leadership and careful planning by the service. A successful scheme setup necessitates multidisciplinary project management, including legal, policy politics, IT and service redesign, often all at once. This can place significant strain on services if not well planned and lead.

Investment and financial support during the first two years of a licensing scheme pays dividends. Investment in technology to improve licensing processing productivity is quickly returned through salary savings. It also helps ensure good landlords have a reasonable online licensing experience. The addition of skilled enforcement staff increases the effectiveness of enforcement interventions and reduces the number of unlicensed properties. This front-loading approach helps schemes achieve self-funding status sooner.

Proactive and meaningful enforcement is essential. This factor is probably the most important of all. Most tenants suffering criminal housing conditions will not complain to LAs. Landlords responsible for criminal housing tend not to license their properties. Therefore, find the unlicensed PRS properties and it is likely that tenants suffering criminal housing will be there. Enforcement should commence as soon as the scheme starts and be maintained throughout the life of the scheme.

Keep licensing schemes simple. Licensing is a simple concept and works best when understood by all; however, the legislative framework is complex and if translated directly can cause confusion. Successful schemes translate this complexity into a simple framework of language and policy for landlords and tenants.

Offer a light touch for good landlords and a heavy touch for bad landlords. This includes lower fees and less bureaucracy for those that are compliant and meaningful enforcement for those that flout the law. This helps generate support for the scheme by the majority of good landlords who are playing by the rules. Good landlords generally want two things from a licensing scheme beyond all else, a) lowest possible costs, both in terms of fees and from the time saved through less bureaucracy and; b) rigorous enforcement for the bad landlords.

Maintain a focus on private tenants’ welfare, particularly vulnerable groups. Incorporating the views of private tenants and ensuring their voices are heard. All licensing schemes should seek to make private tenants lives better, but it’s also important to consider the wider benefits for other residents.

Take a holistic approach to enforcement; enforcers are more effective when they work together. It’s important to deal with poorly managed housing and the symptoms of poorly managed housing, including anti-social behaviour (ASB) and other wrong doing. This means working at a granular level with Police, Immigration Enforcement, ASB Service, Fire Authority, HMRC, Homelessness teams and charities, Planning, Building Control, Gangmasters and Labour Abuse Authority etc.

Invest in technology and new efficient licensing and enforcement processes. This should be done as part of the set-up and can be a major factor in the success of the scheme. I have written a separate blog on this, read more here.

Finally, promote success at every opportunity. Licensing schemes work best with the full consent of good landlords, policy makers and local residents. Promoting licensing and enforcement successes is vital to allow the wider community to understand the important benefits offered by property licensing.