Do your rental properties need a landlord licence?

With so many regulations to comply with, it is easy for landlords to overlook, forget or be unaware of certain aspects which are required for their role. In recent times, there has been a significant increase in the number of licencing schemes launched by local councils.

Landlords must be aware these licences are not just for houses in multiple occupation, HMO. While HMO licences are mandatory, many local councils in England now run selective or additional licence schemes. You must determine if your rental property or properties require a landlord licence before you are informed you do, and you need to face the consequences.

Given that some landlords and property investors have found local councils to be quick to penalise landlords who don’t hold a licence, this is an area of your business; you cannot afford to overlook. Some councils have issued formal warnings, but landlords have been prosecuted. Therefore, you should be proactive in finding out if you need a landlord licence.

An annoying issue to contend with is that different councils apply different rules. Even when houses are close by, and are similar, if they fall under the jurisdiction of separate councils, there may be different rules in place. As an example, one council may require all private rented homes to have a licence whereas a neighbouring council may only ask for rental properties in certain neighbourhoods to hold a licence.

The cost of a landlord licence

With so many bills to pay, landlords are keen to keep their expenditure down. The average cost of a landlord licence is around £500, and this runs for five years. The cost of flouting the licencing laws varies by the council, and it is worthwhile checking with your local council to see what the deterrent in your area is.

Local councils can charge up to £30,000 for each offence. It is unlikely a council will charge this, the figure is more a deterrent for persistent offenders, but the size of the fine should be a warning for landlords.

Rogue landlords are targeted

There is a sustained approach to tackling rogue landlords, and this is a move welcomed by many in the industry. Removing rogue landlords from the sector increases consumer confidence, and it should provide landlords with more opportunities. Of course, if a law-abiding landlord fails to obtain a licence, for whatever reason, they are liable to be penalised in the same manner as a rogue landlord. However, in the long-term, law-abiding landlords should benefit from tighter controls in the letting industry.
As well as fines, local councils can impose a rent repayment order on landlords. Tenants who resided in a property owned by a convicted landlord can apply for a rent repayment order, which may refund rental payments up to 12 months previously.

Being a landlord is challenging, and there are more regulations and rules in place to protect tenants. If you need assistance in managing your property and determining if you need a licence, please contact Nationwide Accommodation Services Ltd, and we’ll be happy to help.


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