In deciding whether an applicant is a fit and proper person to act as a landlord or agent, the local authority will take into account any available and relevant information on the applicant. In particular they must consider any evidence of:
- offences involving fraud, dishonesty, violence or drugs
- unlawful discrimination
- breaches of law relating to housing and letting
- failure to act in relation to antisocial behaviour
The decision of the local authority is a judgement in the light of the totality of information available - there are no grounds for automatic refusal or removal of registration. From 31 August 2011 local authorities will have the power to require a criminal record certificate when applying the fit and proper person test. Particularly if the local authority has reasonable grounds to suspect that the information provided is, or has become, inaccurate. If a registered landlord fails to provide this, they may be removed from the register.
Does the fit and proper test consider agency arrangements?
Yes. If a landlord uses an agent to manage his or her property, this must be listed on the application form. The local authority scrutinises the agent and the agency arrangement as part of the fit and proper test. This includes ensuring that the property management has been genuinely handed over to the agent and that the agent would react appropriately if the owner tried to intervene.
What happens if a landlord's agent is not registered?
Agents are not required to register in their own right, but they need to pass the fit and proper test and an application fee must be paid for them. If a landlord uses an agent, the agent must be found fit and proper before the landlord's application can be approved. If the agent fails to co-operate with this process, the landlord may need to find another agent if he or she wishes to continue letting. An agent who does not provide the required information for the fit and proper test will not be able to manage property in that area.
From 31 August 2011 it is an offence if landlords do not notify the local authority if they appoint an agent. This will be punishable by a fine of up to £1,000.
What happens to a landlord who fails the fit and proper test?
The local authority will seek to improve existing arrangements where possible. A landlord who failed the fit and proper test would usually be advised of the steps required which would allow him or her to become fit and proper. This may involve using an agent under an appropriate arrangement.
Where such a solution is not feasible, or where no agency will agree to deal with the landlord in question, such a landlord would have no option but to stop letting.
What happens to the tenants of a landlord who fails the test?
The fact that a landlord has been refused registration is not a ground on which he can legally evict his tenants. The landlord would have to give the tenants proper notice and obtain a court order if he wished them to leave. Alternatively he might sell the property to a registered landlord. The local authority is required to provide advice and information about their rights to the occupiers of any property owned by a landlord who has been refused registration.
How much variation is possible between local authorities?
The information required in the application for registration, and the fees charged, are prescribed in legislation and must therefore be the same in all areas.
Local authorities may vary in the way they process applications, and the level at which decisions are made.
Is it possible for a landlord to be registered in one local authority and refused registration in another?
Yes. It is possible that a landlord may operate poorly in one local authority but be fit and proper in another - perhaps he or she uses different agents or has different types of tenants, for example.
However, local authorities are encouraged to exchange information on applicants. It may be that some important information on an applicant comes to the attention of one local authority only, and it is important that such information is shared with other local authorities in which the applicant lets property so that each can make an informed judgement.
Why doesn't the fit and proper test include an inspection of physical standards in the property?
Private landlords have a range of pre-existing legal obligations, which include ensuring that the property they provide meets certain physical standards. When they apply to register, landlords must declare that they comply with these legal obligations. If it comes to light that they do not, the local authority will be able to take action, not least on the basis that the landlord provided false information in their application.
In considering how landlord registration should operate, the level of inspection required was discussed. It was decided that inspection of every property would be too onerous, and that the key point was to make landlords and tenants more aware of their existing rights and responsibilities. If problems come to light, those can be dealt with individually. Local authorities may choose to inspect a sample of properties.
Why can an unfit and improper landlord be registered if he or she engages a fit and proper agent?
A landlord must be fit and proper to be letting. It is possible that a landlord who would otherwise fail the test could make an arrangement with an agent which leads to fit and proper letting for the tenant. Where this can be done, it is a better solution than losing that accommodation from the sector. However, there may be some landlords who will not be accepted even with an agent. The local authority needs to decide, on balance, whether or not to register the landlord in the light of the agency arrangement and any other relevant information in its possession.