First UK landlord banned from the PRS after investigation

A Private Rental Sector landlord has been banned from the sector and ordered to pay back housing benefit paid to him by Telford and Wrekin council, after he was found not fit and proper to receive an HMO (house of multiple occupation) license. This is the first time a landlord has been banned from the PRS sector since new rules were introduced and is a landmark case.

Telford landlord, David Beattie, was ordered to repay Telford and Wrekin Council back the housing benefit payments he had received from them, for two tenants he housed while running an unlicensed HMO.

Landlord banned for five years

The court heard that the Telford landlord, Mr. Beattie failed to apply for an HMO license as he knew he wouldn’t be granted one. Despite that and his full understanding that his HMO required a local council license, the landlord continued to operate as a landlord and rent rooms out in his 7-bedroom rental property.

However, inspections carried out by the council in 2018 found five people were living in the property that was an unlicensed HMO. The council had attempted to find a way to work with the PRS landlord, but they reported to the tribunal court that Mr. Beattie refused them all, including to allow a lettings agent manage the property, or to sell it.

This left the council with little option than to take action which would ensure a landlord who doesn’t follow the rules put in place to support both tenants and landlords was unable to continue his unlawful business.

“Everyone deserves a decent and safe place to live, and I am determined to crack down on rogue landlords who consistently choose to neglect their responsibilities,” said Housing Minister, Esther McVey. “I welcome the fact that councils like Telford & Wrekin are making use of the powers available to tackle these criminals, forcing them to either raise their standards or leave the sector entirely.”

Landmark ruling

In a first for the industry, the Telford landlord has now been banned from being a landlord for five years. This highlights that the Government and local councils are willing to act where landlords don’t follow the rules and provide the right housing for the UK’s still growing number of PRS tenants.

“This is a landmark case; the first banning order to be applied since it became part of law more than a year ago,” said Councillor Richard Overton, Telford & Wrekin Council’s cabinet member for enforcement. “It shows how seriously we take the issue of rogue landlords.”

While this ruling will send a message to the rogue landlords that still operate across the UK, it also shows that there probably aren’t quite as many of them as some people think. Indeed, that it’s taken around one year for the first ban for not having an HMO license to be issued, shows that the vast majority of PRS landlords are fair traders who provide safe and decent housing for their tenants.

For landlords who continue to operate by the book and rent out homes that are fit to live in and treat their tenants the right way, being a BTL landlord is still a potentially profitable business option for existing landlord and potential new ones, too.