Selective licensing and resident satisfaction in social housing: a UK case study

• Author: Julian Sidoli del Ceno
• Position: Birmingham City University, Birmingham, UK

1 Introduction

1. 1 The legislative context

The Housing Act, 2004 ¹ introduced a scheme of selective licensing that permitted a local authority to place an additional system of regulation and sanction on private landlords in a designated area. The Act came into force in April 2006. It was introduced as an attempt to address a number of distinct but arguably related issues: poor quality private housing (often coupled with indifferent management) and anti-social behaviour. It had been primarily developed with the need to tackle problems in areas of low demand and many of the provisions bear similarity to those relating to the mandatory and discretionary licensing of houses in multiple occupation (HMOs). This was also introduced by the Housing Act (2004) ². In an area subject to selective licensing, all private landlords must obtain a licence and if they fail to do so, or fail to achieve acceptable standards of management, the authority can take enforcement action.

1. 2 Aim and rationale

The aim of this paper is to present the findings of empirical research based on a case study of one such scheme broadly a year after its implementation. It focuses exclusively on the views and perspectives of the tenants and other residents within the designated area. The rationale for the explicit focus on the views of tenants and other residents is considered in more detail below but, at the very least, the improvement in the experience of the actual resident – be they private tenants, housing association or local authority tenants or owner-occupiers must be considered important. Such improvement in experience might be found in the improving quality of their individual property, more community cohesion or better property management. It might also be found in a lower level of anti-social behaviour or in more intangible sense of well-being and satisfaction with the local area and their place within it. Whilst it is perhaps easier in many housing matters to talk about “objective” housing standards such as the availability of central heating and the newness and quality of various fittings it is not necessarily those things that lead to a genuine improvement in tenant contentment or overall satisfaction. Zumbro (2011) has argued that this purely financial or housing “quality” approach is wrongheaded. This debate is considered further below.

1. 3 Selective licensing and its impact on residents

There is limited material on selective licensing or on its effects. This is, perhaps, surprising for whilst it is a relatively new legislative measure it is one of some importance to those active in law, housing, local government and policy. A major study was commissioned by the Department of Communities and Local Government (DCLG) and published in January 2010. This looked at the implementation of both selective licensing and the licensing of houses of multiple occupancy although the matters were separately reported. The study examined three areas in England that had implemented such a scheme at an earlier date to the subject of this case study. The views of all parties were studied including the professional officers that implemented and monitored the various schemes.

This particular study is, then, the first such examination of the effects of selective licensing on a given area which focuses solely on the actual effects of the measures on the residents themselves. The reason for focussing specifically on the views of the residents, both tenants and owner-occupier, is two-fold. It is argued that the actual views of the residents are paramount. This is because they actually live in the area concerned and are therefore the direct beneficiaries of any improvement. Conversely, it is they who primarily suffer from the effects of poor housing and are usually the victims of anti-social behaviour. It is they who are then in the best position to judge whether or not their general quality of life has improved and it is this “general sense of improvement” which must be the ultimate aim of any such scheme. The second reason is that there is a danger in a mixed study that examines the perspectives of all parties for the perspective of the tenant to be lost. Whilst there is a danger in any study for the views of one party to overshadow that of another, the danger is probably greater within the context of social housing. This is because the social and intellectual capital of the local authority and their professional advisors as well as the landlords, who also have a financial interest at stake, will have the tendency to drown out the voice of the tenant who may in some cases lack confidence and the ability to articulate their concerns clearly or forcefully. Further, there has been much emphasis among both councils and academics that have stressed the importance of tenant participation ( Tenant Services Authority, 2009 ; Paddison et al., 2008 ). This marries with long-standing jurisprudential concerns about the inequality of bargaining power ( Kennedy, 1982 ): this study continues in that vein.

The council in this case study produced their own designation report prior to the implementation of the scheme. This report notes that only 38 per cent of residents living in the proposed area responded to the consultation document. Considering the small area and the specific targeting of that area then this is a relatively low figure. Of these 76 per cent of respondents were owner-occupiers whilst only 16 per cent were tenants of private rented housing. These figures clearly support the idea that it is the views of the residents that are likely to be underrepresented in studies.

1. 4 Anti-social behaviour and management standards

The legislation specifies that for a selective licence to be granted a number of conditions must pertain. These are high incidences of anti-social behaviour, a high proportion of privately rented properties and low housing demand. Anti-social behaviour is defined in The Crime and Disorder Act 1998 as:

(a) that the person has acted, since the commencement date, in an anti-social manner, that is to say, in a manner that caused or was likely to cause harassment, alarm or distress to one or more persons not of the same household as himself; and

(b) that such an order is necessary to protect relevant persons from further anti-social acts by him³.

Although this explicitly excludes domestic incidents, it is nonetheless a somewhat vague definition that can seemingly encompass almost all forms or categories of unwanted activity. Numerous commentators have noted this lack of precision ( Whitehead et al., 2003 ; Macdonald, 2006 ) whilst others such as Millie (2006, 2008) have argued that what might, in some cases, be classified as anti-social behaviour might in other contexts be something to celebrate. Despite academic definitional concerns there seems to have been little difficulty in practice at the policing or judicial level. Further, as discussed below, the actual residents themselves had no difficulty understanding the concept.

The requirements of the licence require licensees to be “fit and proper persons⁴”. There is very little guidance on what constitutes such a person in practice as most of these hearings go unreported. The test is comparable to that required by the licence holder of a HMO. In the case of Maclennan⁵ the applicant was refused a HMO licence on the grounds that the applicant was not a fit and proper person to hold a licence under the Act and that the management arrangements were not sufficient owing to the applicant's incompetence. This was based on the criteria under section 66(3) that the applicant was considered unfit taking into account evidence of her bad character by submitting misleading applications. The applicant appealed to the Residential Property Tribunal⁶ but the decision of the local authority was upheld. What is clear from this is that lacking the ability to manage correctly, whether intellectually or socially, will be a potential bar to a licence ( Sidoli del Ceno and Johns, 2008 ).

1. 5 Ownership, tenant satisfaction and ontological satisfaction

There is much literature that equates happiness and social responsibility with home ownership. Rackoff (1977) argues that homeowners have higher social status. Home ownership is often seen as a method of wealth accumulation ( Venti and Wise, 2004 ) and a factor leading to better health ( Nettleton and Burrows, 1998 ). Saunders (1978, 1990) and Dupuis and Thorns (1998) found that home-ownership contributed to self-esteem and overall life satisfaction whilst Mulder and Wagner (1998) found that the overall quality of life is frequently better. A major US study stated:

Homeownership is a commitment to strengthening families and good citizenship. Homeownership enables people to have greater control and exercise more responsibility over their living environment. Homeownership is a commitment to community. Homeownership helps stabilize neighborhoods and strengthen communities. It creates important local and individual incentives for maintaining and improving private property and public spaces ( US Department of Housing and Urban Development, 1995 ).

This value of community has been found more recently by Blokland (2008) who noted the increased neighbourhood stability brought about by home ownership. Zumbro (2011) however, whilst bearing out the value of...