Landlord Selective Licensing: Penalties, Registration Requirements and How Councils Enforce It

What Is Selective Licensing?

Selective licensing is a form of landlord licensing under Part 3 of the Housing Act 2004. It enables a local housing authority to require every privately rented property in a designated area to be licensed, regardless of the size of the property or the number of occupants.

It is distinct from two other forms of mandatory licensing under the same Act:

• **Mandatory HMO licensing:** Applies nationally to Houses in Multiple Occupation (HMOs) of three or more storeys with five or more unrelated occupants forming two or more households. All councils must operate this scheme.
• **Additional HMO licensing:** An optional scheme allowing councils to require licensing for smaller HMOs not captured by mandatory licensing.
• **Selective licensing:** Covers all privately rented properties in a designated area, including single-family lets.

How Selective Licensing Schemes Are Established

A local authority wishing to introduce a selective licensing scheme must demonstrate that one or more of the conditions in section 80 of the Housing Act 2004 are met in the proposed designation area. These conditions include: the area is, or is likely to become, an area of low housing demand; the area is experiencing a significant and persistent problem caused by anti-social behaviour; the area has a significant proportion of properties in poor condition; the area has high levels of migration, deprivation or crime.

Before confirming a scheme, the council must consult with persons likely to be affected (landlords, tenants, residents and representative bodies) for at least ten weeks. Schemes covering more than 20% of the council's geographical area, or more than 20% of privately rented properties in the area, require confirmation from the Secretary of State under the Housing Act 2004 (as amended by the Housing and Planning Act 2016).

Selective licensing schemes last a maximum of five years and can be renewed.

What Landlords Must Do in a Licensed Area

Once a selective licensing scheme is in force, every private landlord letting a property in the designated area must:

1. **Apply for a licence** before the property is let, or within the period specified when an existing let becomes subject to a new scheme.

2. **Pay the licence fee** — set by the council and typically ranging from £500 to £1,000 per property for a five-year licence, though fees vary significantly.

3. **Meet the licence conditions**, which typically include:

• Providing a current gas safety certificate annually.
• Providing an Electrical Installation Condition Report (EICR) every five years.
• Ensuring smoke alarms are installed on every floor and carbon monoxide alarms in rooms with combustion appliances (as required by the Smoke and Carbon Monoxide Alarm (England) Regulations 2022).
• Providing tenants with a copy of the licence and any attached conditions.
• Managing the property to prevent anti-social behaviour by tenants.
• Providing the council with tenancy agreements and referencing information on request.

4. **Pass the "fit and proper person" test** — the licence holder (and any managing agent) must not have been convicted of specified housing, violence, drugs or fraud offences.

Penalties for Operating Without a Licence

The consequences of letting a licensable property without a licence are serious:

**Criminal prosecution:** Under section 95 of the Housing Act 2004, letting a licensable property without a licence is a criminal offence. On summary conviction in a magistrates' court, the fine is unlimited (the standard scale for housing offences was removed by the Legal Aid, Sentencing and Punishment of Offenders Act 2012).

**Civil penalties:** As an alternative to prosecution, councils can issue a civil penalty notice of up to £30,000 per property under the Housing and Planning Act 2016. Civil penalties do not result in a criminal conviction but are still substantial.

**Rent Repayment Orders:** A tenant (or the council) can apply to the First-tier Tribunal (Property Chamber) for a Rent Repayment Order (RRO) under Chapter 4 of Part 2 of the Housing and Planning Act 2016. An RRO requires the landlord to repay up to 12 months' rent to the tenant. Where the property was in receipt of Housing Benefit or Universal Credit, the council can claim repayment of the housing element paid during the unlicensed period.

**Restrictions on serving notice:** A landlord who has not obtained a required licence cannot serve a valid section 21 notice (no-fault eviction notice) while the property is unlicensed. This restriction applies even where the section 21 notice would otherwise be valid.

Checking Whether Your Property Is in a Licensed Area

Many landlords discover selective licensing schemes only after they have been in force for some time — often when they receive an enforcement notice. The most reliable approach is to check the local council's housing licensing page at the time of purchase or before letting a newly acquired property. Property Passport UK surfaces licensing designation information where available, but direct confirmation with the relevant local housing authority is always advisable before marketing a property for rent.