Housing Act 2004 and Renters' Rights Act: What They Mean for Landlord Licensing

The Housing Act 2004: The Foundation

The Housing Act 2004 is the primary legislation behind every property licensing scheme in England. It created three licensing frameworks that Croydon (and every other council) operates under:

Part 2 — HMO Licensing: Sections 55–78 give councils the power to licence houses in multiple occupation. Section 55(2)(a) establishes mandatory HMO licensing for larger shared houses (five or more occupants, two or more households). Section 56 allows councils to designate additional HMO licensing for smaller shared houses (three or four occupants) where they can demonstrate a need.

Part 3 — Selective Licensing: Sections 79–100 allow councils to require all privately rented properties in designated areas to hold a licence, even single-household lets. Section 80 sets out the conditions a council must satisfy: evidence of poor housing conditions, anti-social behaviour, deprivation, migration or high housing demand.

Section 95 — The Offence: Operating a property that requires a selective licence without one is a criminal offence under Section 95(1). The equivalent for HMOs is Section 72(1). Both carry unlimited fines on prosecution or civil penalties of up to £40,000 under Section 249A.

What Changed in 2024

The Housing Act 2004 General Approval 2024 (effective 23 December 2024) removed a significant procedural hurdle. Previously, any selective licensing scheme covering more than 20% of a council's geographical area or private rented stock needed confirmation from the Secretary of State. This often delayed schemes by months or years.

The General Approval 2024 allows councils to designate wide-area schemes through local cabinet approval alone, provided they meet the statutory evidence requirements. Croydon used this new power to approve its 14-ward selective licensing scheme (covering 72.5% of the borough's non-HMO private rented stock) through cabinet approval on 25 March 2026, without needing central government sign-off.

The Renters' Rights Act 2025: What It Adds

The Renters' Rights Act 2025 (Royal Assent 27 October 2025) is not a licensing law, but it changes the enforcement landscape around licensing in important ways:

Phase 1 (1 May 2026):

• Assured shorthold tenancies and Section 21 "no-fault" evictions are abolished across England
• All private lettings automatically become periodic tenancies
• Rent increases are restricted to annual Section 13 notices
• Fixed-term tenancy terms are prohibited

Phase 2 (15 July 2027):

• The national PRS Database opens for London landlords
• Registration deadline: 14 October 2027
• Annual fee: £65 per property

Impact on licensing enforcement:

• Landlords operating unlicensed properties cannot lawfully issue statutory possession notices while the property remains unlicensed — the Renters' Rights Act tightens this restriction
• Rent Repayment Orders now cover up to 24 months of gross rent (doubled from the previous 12-month cap) for licensing offences committed after 1 May 2026
• The national database runs alongside local licensing — landlords need both

Section 95 in Practice

Section 95 is the provision most relevant to selective licensing enforcement. If a property in one of Croydon's 14 designated wards is let to a single household without a selective licence, and no valid application has been submitted, the landlord commits an offence under Section 95(1).

The statutory defence is in Section 95(3): if the landlord can prove a complete application was duly made and is awaiting determination, they are protected. "Duly made" means the application, all mandatory documents and the Part A fee have been submitted and validated by the council. An incomplete application or an unpaid fee does not trigger this defence.

Croydon's enforcement policy sets the starting point for a Section 95 offence (unlicensed selective property) at £12,000, with aggravating factors (deliberate evasion, previous offences, property in poor condition) pushing the penalty higher toward the £40,000 maximum.

Why This Matters for Croydon Landlords

The combined effect of these two pieces of legislation is a significantly tougher enforcement environment. The Housing Act 2004 gives the council licensing and penalty powers. The Renters' Rights Act 2025 doubles the tenant's ability to recover rent through RROs and blocks the landlord's ability to use possession proceedings while unlicensed. Together, they make operating without a licence both expensive and practically unworkable.

For a step-by-step guide through Croydon's licensing requirements, see our landlord licensing guide.

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