Landlords of bedsits above shops in a London borough could be clobbered with a licensing fee that is set to rise by 278%.
Each bedroom licence would cost £500 with some landlords having to pay the maximum – a cap of £5,000 per building.
The claim comes from Richard Tacagni, managing director of an independent consultancy London Property Licensing.
He says that the new HMO licence fee being brought in by Lewisham Council will be by far the highest in London and probably in England.
The new fee was agreed last week as part of the additional licensing scheme expected to be implemented by this autumn and covering all Houses in Multiple Occupation above commercial premises.
The new scheme will require licensing of around 1,800 properties, containing some 4,200 separate lettings.
According to Tacagni, Lewisham Council has confirmed that any flat shared by three or more people who are not all related will need a licence if there are commercial premises on a lower floor in the building.
The fee will be £500 per unit.
Tacagni said: “Whilst a £500 licence fee may at first appear reasonable, we understand that this is actually the fee per letting within a property, ie a single person occupying one room on a separate tenancy.
“The council have said that the fee would be capped at £5,000 per property for ten or more lettings.
“This dramatic increase in fees will see the existing mandatory HMO licensing fee rise from £180 (frozen since 2012) to £500 per letting, an increase of 278%.
“The fee to license an HMO with five individual room lets would rise from £900 to £2,500.”
A Lewisham Council spokesperson said: “We are committed to ensure that Lewisham has a thriving private rented market that provides good quality housing for tenants and that landlords are fully supported to maintain good standards in their properties.
“This licensing scheme is a key tool in achieving this.
“We have set the fee to ensure that we fully meet the costs of running an effective licensing scheme that is good for tenants and good for responsible landlords.
“We have a range of qualifying discounts and reductions that will continue.
“All the income raised will be reinvested in this scheme to improve the private rented sector in Lewisham, which is huge and growing every day.”
“All the income raised will be reinvested in this scheme to improve the private rented sector in Lewisham, which is huge and growing every day.”
…or..
“All the income raised will be used to increase the salaries and expenses of senior executives of Lewisham Council, which is huge and growing every day.”
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Another ROGUE COUNCIL! Perhaps Mr Goldsmith will eliminate rip off councils (in our dreams!!!!) rather than tackling letting agents where people have a choice!!!
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Does Mr Goldsmith not realise that all this will do is push rents up even further and make it harder again for the London market to get on the ladder.
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Ker-ching another circa £2,000,000 in the council’s coffers. Remind me why are rents rising? more admin, more “Blue Tape” all adds to the cost of renting.
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Just once I would like a council official to confirm, in clear English, exactly what they plan to do to improve the letting industry that couldn’t already be done by using their existing powers which are already paid for by local council tax revenues.
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