Housing Secretary Robert Jenrick has rejected a bid by Labour-controlled Liverpool council to extend its licensing scheme for five years.
Government approval is needed for schemes which cover more than 20 per cent of a council area, and Liverpool wanted to continue with a citywide scheme due to the size and scale of the issue with the private rented sector in the city, which accounts for up to half of housing in some areas and covers 55,000 properties in total.
In recent years it has been rare for local authority landlord licensing schemes to be knocked back by government.
The industry has been reacting to the news with delight.
Residential Landlords Association policy manager John Stewart said: “Liverpool’s application for a second new city-wide application was doomed to failure. Unlike their initial scheme, the renewal required permission from the Secretary of State, and robust evidence to back the application.
“The RLA made it clear that the council’s evidence failed to justify a city-wide scheme on the basis of low demand. The council’s own statistics showed increasing house prices and lower void periods across many areas of the city.
“In addition, the operation of the current selective licensing scheme left much to be desired, with long waits for licences and a focus on minor, often administrative breaches, rather than tackling the worst property management and conditions.
“A much more focussed approach is required, and we welcome the rejection of the city-wide scheme.”
And Isobel Thomson, safeagent chief executive says: “Since its inception, safeagent has been a co-regulation partner to Liverpool City Council’s Citywide Licensing Scheme. We were pleased to be involved in the initiative which has helped to improve property and management standards in Liverpool's Private Rented Sector.
"We are now looking forward to working in partnership with Central and Local Government, within a more coherent national framework of regulation and enforcement. It is our hope that sufficient resources will be made available to ensure that standards in the PRS in Liverpool and across England continue to rise. "