What Is Selective Licensing? A Guide for Private Landlords

If your local council has introduced selective licensing, every privately rented property in the designated area needs a licence — not just HMOs. Many landlords hear about licensing and assume it only applies to shared houses. Selective licensing is different, and its reach is much wider.

How Selective Licensing Works

Selective licensing operates under Part 3 of the Housing Act 2004. It gives local councils the power to require a licence for all privately rented properties in a defined area, regardless of how many people live there. A single-family home rented to a couple needs a selective licence just as much as a flat shared by two unrelated tenants.

Councils introduce selective licensing to tackle specific local problems: low housing demand, anti-social behaviour, poor property conditions, high levels of migration, high deprivation, or high crime. The designation lasts for a maximum of five years, after which the council must decide whether to renew it.

Before December 2024, councils that wanted to cover more than 20% of their area or private rented stock needed explicit approval from the Secretary of State. The Housing Act 2004: Licensing of Houses in Multiple Occupation and Selective Licensing of Other Residential Accommodation (England) General Approval 2024, effective 23 December 2024, removed that requirement — meaning councils can now implement borough-wide schemes without central government sign-off. Several London boroughs have already taken advantage of this change.

Which Properties Need a Licence

Within a selective licensing area, every privately rented dwelling needs a licence unless a specific statutory exemption applies. That includes:

• Houses and flats rented to single-person households
• Properties rented to families
• Flats rented to two unrelated sharers
• Individual flats within converted blocks (including section 257 HMOs)

Properties exempt from selective licensing include owner-occupied homes, social housing managed by local authorities or housing associations, holiday lets, long leases exceeding 21 years, and properties where a resident landlord takes in no more than two lodgers. If the property already has a valid mandatory or additional HMO licence, it doesn't also need a selective licence — the HMO licence supersedes it.

The Application and Fees

Selective licence applications go through the council's online portal. The process typically involves:

1. Registering an account and entering the property address
2. Providing occupancy details and household composition
3. Uploading compliance documents — Gas Safety Certificate, EICR, EPC, floor plans, tenancy agreement
4. Declaring that interested parties (mortgagees, freeholders) have been notified
5. Paying the application fee

Most councils split the fee into two parts: Part A (non-refundable application processing fee) paid at submission, and Part B (licence issuance fee) paid after the property passes inspection. Total fees vary by borough — typically £500 to £1,100 for a selective licence, with compliance discounts available in some areas.

What the Licence Conditions Require

A selective licence comes with mandatory conditions that run for its full term (up to five years). Standard conditions include:

• Maintaining valid Gas Safety Certificates and EICRs throughout the licence period
• Keeping working smoke alarms on every storey and CO detectors where required
• Providing tenants with copies of required safety certificates
• Managing anti-social behaviour and keeping written records of complaints and actions
• Not overcrowding the property beyond the occupancy limit on the licence
• Notifying the council of any changes to the licence holder, manager, or property circumstances

Breaching licence conditions can result in a civil financial penalty of up to £30,000 per offence under section 249A of the Housing Act 2004, or prosecution. The Renters' Rights Act 2025 also allows penalties up to £40,000 for serious, fraudulent, or persistent housing breaches.

What Happens Without a Licence

Operating a privately rented property without a licence in a selective licensing area is a criminal offence under section 95 of the Housing Act 2004. Councils can prosecute (unlimited fine on conviction) or issue civil penalties of up to £30,000 per offence. For offences committed on or after 1 May 2026, Rent Repayment Orders can cover up to 24 months of rent; earlier offences remain subject to the previous 12-month limit. Section 21 notices were abolished across England on 1 May 2026 under the Renters' Rights Act 2025.

If your property is in a borough with selective licensing — like Barking and Dagenham, where the borough-wide scheme runs from 6 April 2025 to 5 April 2030 — the licence is non-optional, and applying early protects both your legal standing and your fee discounts.

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