The number of people living in private rented accommodation is steadily rising. Although most landlords do a great job, there is a small proportion of “rogue landlords” who don’t look after their properties. In some areas of the country, local councils have introduced a landlord licencing scheme to check up on the people who are letting accommodation in the private sector. The law about licensing is fairly complex, so here’s what you need to know.
If you let a large House in Multiple Occupation (HMO)
Irrespective of where you live in the country, you will need a licence to run a large HMO property. This is defined as a house of three storeys or more, which has more than five occupants who aren’t all in the same family. This rule also applies to accommodation like bedsits, where residents have their own kitchen facilities. There is a lot of confusion around what constitutes a HMO, so if you’re unsure, get advice. The housing team at your local council will be more than happy to keep you on the right side of the legislation.
Selective Licensing
In some areas of the country, local Councils have set up their own system for vetting residential landlords. Around a fifth of the councils in England and Wales have this sort of system. Individuals get the licence, not the property. If you sell your rented property, then the new owner will have to reapply for a licence. On the flip side, if you have several properties, you only need to apply for one licence. In order to get a licence, you’ll need to submit paperwork to the local council and apply for a fit and proper person check. This is similar to a DBS check. The Council will run basic checks to make sure you haven’t got an extensive criminal record, or have been prosecuted in the past by your tenants.
There is a fee to pay for your licence which varies across the country. Expect to pay between £200 and £500 for your licence. Usually, licences are valid for five years. After that period you would be expected to reapply, and pay the fee again. Councils may also ask you to sign up to a charter, agreeing to basic standards for your properties.
Problems With the Licensing Scheme
Several concerns have been raised about the scheme from both landlords and tenant action groups. The main concern is that it’s only the landlords who are doing a great job already who will come forward and agree to be registered. Rogue landlords will continue to fly under the radar and won’t care if they are operating illegally. There is also a worry that the many councils lack the “teeth” to implement the legislation. Landlords who refuse to comply with the licensing scheme can be prosecuted, but cash-strapped Councils lack the resources to do so. It also appears unfair to many that the system is so selective, operating in some areas and not in others.
