Does Your Rental Property Need a Licence? The Penalties Landlords Could Face
Landlord licensing is not only for large shared houses.
Depending on where your property is and who lives there, an ordinary house or flat rented to one person or family may also need a licence.
Local schemes change over time, so it is important to check every property regularly. A licence that was not needed when a tenancy began may become necessary later.
What types of landlord licence are there?
There are three main types of property licence in England.
Mandatory HMO licensing
Mandatory licensing generally applies where at least five people from two or more households live in a property and share facilities such as a kitchen or bathroom.
Additional HMO licensing
Councils can introduce additional licensing for smaller houses in multiple occupation that fall outside the mandatory scheme. The properties covered will depend on the local council’s rules.
Selective licensing
Selective licensing can apply to other privately rented homes within a designated area. This may include a property rented to a single tenant, a couple or one family.
Our guide to selective licensing in the private rented sector explains how these local schemes work.
How can you check whether your property needs a licence?
Start with the local authority responsible for the property. Check its licensing pages, postcode checker or scheme map rather than assuming the same rules apply across the whole borough.
You will usually need to consider:
- The property’s address and ward
- How many people live there
- How many households they form
- Whether facilities are shared
- Whether another licence or exemption already applies
- When an existing licence expires
The responsibility to apply sits with the landlord or person managing the property. Do not wait for the council to contact you.
Croydon’s new licensing schemes
Croydon is a useful example of how quickly local requirements can change.
From 25 September 2026, selective licensing will apply to qualifying privately rented homes in 14 Croydon wards. This includes properties rented to a single tenant, one household or two people sharing.
Additional HMO licensing will begin across the whole borough on the same date. It will cover HMOs occupied by three or more people from two or more households, unless mandatory HMO licensing already applies.
Gloucester’s new licensing scheme
Gloucester is also introducing a new licensing scheme. From 21 September 2026, additional HMO licensing will apply across the city. Landlords will need a licence where a property is occupied by three or four people forming two or more households, unless it is already covered by mandatory HMO licensing.
Unlike Croydon, Gloucester’s new scheme focuses on smaller HMOs rather than properties rented to a single household. This shows why landlords need to check the exact requirements for the area where each property is located.
Croydon and Gloucester are not alone. Havering introduced new selective and additional licensing schemes on 18 March 2026. Wandsworth also expanded selective licensing to East Putney, West Putney and Northcote from April 2026.
Landlords should check the rules for every property they own or manage, even where it has been rented out for several years.
What penalties could landlords face without a licence?
Operating a property without the required licence is a criminal offence.
A council can issue a civil financial penalty of up to £40,000 instead of prosecuting. If the case goes to court, the landlord could face an unlimited fine. Separate offences can also result in separate penalties.
Tenants or the council may also apply for a Rent Repayment Order. For offences committed from 1 May 2026, this can require the repayment of up to two years’ rent received while the property was unlicensed.
The cost of getting this wrong can therefore be far higher than the licence fee itself. Our guide to the fines landlords face under the Renters’ Rights Act explains some of the wider enforcement risks landlords need to understand.
What should landlords do before applying?
First, check which licence you need and note the application deadline. Gather the documents requested by the council, which may include your:
- Gas Safety Certificate
- Electrical Installation Condition Report
- Energy Performance Certificate
- Floor plan
- Tenancy and property management information
- Smoke and carbon monoxide alarm details
Requirements vary between councils, so always follow the checklist for the area where the property is located.
Keep proof that your application was submitted and read the licence conditions carefully once it is granted. Holding a licence is not the end of the process. You must continue to meet its conditions throughout the licence period.
Our guides to landlord documents and property safety standards can help you review your wider paperwork and responsibilities.
Check your property before it becomes a problem
Licensing rules are local, detailed and easy to miss. Checking now gives you time to gather the right documents and apply before enforcement becomes an issue.
If you are unsure whether your property needs a licence, speak to your local Andrews team. We can help you understand the requirements, provide relevant documents and, where available, prepare and submit the application on your behalf.
