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Property Licensing Explained
Does your rental property need a licence? A practical guide to mandatory HMO, additional HMO and selective licensing in England.
Does your property need a licence?
It depends on the property, who lives there and the local council's licensing schemes. Some properties must be licensed under national HMO rules. Others may require a licence because the council has introduced an additional or selective licensing scheme.
The safest starting point is to check the property's postcode with the relevant local authority. Find your local council on GOV.UK →
The three types of property licensing
In England, the main licensing arrangements are mandatory HMO licensing, additional HMO licensing and selective licensing. The rules are different, so it's important to establish which applies to your property.
1. Mandatory HMO licensing
Generally required where five or more people from two or more households live in a property and share facilities such as a kitchen, bathroom or toilet. Some converted buildings are subject to special rules.
2. Additional HMO licensing
Councils can introduce schemes covering HMOs that fall outside mandatory licensing. Depending on the local designation, this may include properties occupied by three or four people from two or more households.
Check the council's scheme boundaries, property definitions and any exemptions.
3. Selective licensing
Selective licensing can apply to privately rented homes within designated areas, including properties rented to a single person or family. A property does not have to be an HMO to fall within a selective licensing scheme.
Statutory exemptions apply, and some properties already subject to HMO licensing are excluded. Read GOV.UK's selective licensing guidance →
Important: A property that does not need a licence today may require one in future. Councils can introduce, extend or replace licensing schemes, so check local requirements regularly and keep track of renewal dates.
What's changed with selective licensing?
Since 23rd December 2024, local authorities in England have generally been able to introduce selective licensing schemes without obtaining individual approval from the Secretary of State. Councils must still meet the statutory criteria and consultation requirements.
This makes it particularly important for landlords to monitor council proposals, consultations and newly designated areas. See the government's guidance →
Landlord property licensing checklist
These four steps will help you check your obligations and stay organised.
What happens if a property is let without the required licence?
Letting a property without a licence when one is required can have serious consequences. These may include prosecution, an unlimited fine or a civil financial penalty.
For qualifying offences committed on or after 1st May 2026, the maximum civil penalty for certain licensing offences is £40,000. Rent repayment orders may also apply and, for qualifying offences committed on or after that date, can cover up to 24 months. Earlier offences may be subject to different limits and rules.
An unlicensed property can also affect certain possession procedures. The precise consequences depend on the circumstances and the legislation applicable to the offence.
Practical tip: If you're unsure whether a property should be licensed, contact the relevant council before letting it. Don't assume that a previous exemption or a neighbouring property's status applies to your address.
Need a helping hand?
Property licensing can be confusing, particularly when local schemes change. TOLA can help you explore your letting and property management options.
Official sources and useful links
Reviewed 21st October 2026. Guidance relates to England only and is for general information, not legal advice. Confirm current licensing requirements with the relevant local authority.