You have a property to let, and a nagging question sits at the back of your mind: do you actually need a licence for it? The honest answer is that it depends on three things - what type of property it is, how many people live there, and which council area it sits in. Get it wrong and the bill can run into thousands, so it is worth ten minutes to work out where your specific let falls.
This guide walks through the three licensing schemes that operate in England, gives you a decision path for a single property, and shows you how to check the local scheme before you hand over the keys.
The three types of landlord licence
England has three separate schemes. A property can fall under one of them, or none. In rare cases a large HMO in a selective area is caught by more than one, but a single home is only ever caught by one scheme at a time.
| Scheme | Who it covers | Set by |
|---|---|---|
| Mandatory HMO | Large HMOs: 5+ people, 2+ households, sharing a kitchen, bathroom or toilet | National law, all of England |
| Additional HMO | Smaller HMOs (often 3-4 sharers) the council chooses to bring in | Individual council designation |
| Selective | All, or most, privately rented homes in a defined area - not just HMOs | Individual council designation |
The key point is that mandatory HMO licensing applies everywhere in England automatically. Additional and selective licensing only exist where a council has formally designated a scheme, so two identical flats a mile apart can have completely different obligations.
A decision guide for your specific let
Work through these in order.
Step 1: Is it a large HMO?
Your property is a licensable HMO under mandatory rules if it is occupied by five or more people forming two or more separate households, and those people share a kitchen, bathroom or toilet. A "household" means people related by blood, marriage or a couple relationship, so five unrelated sharers are five households, while a family of five is one.
If that describes your let, you need a mandatory HMO licence. Note the old "three or more storeys" condition was removed on 1 October 2018, so a two-storey house or even a large flat can be a licensable HMO now (gov.uk: HMO licence).
Step 2: Is it a smaller HMO?
If you have three or four sharers from two or more households, you are outside the mandatory scheme but may be caught by additional licensing. Many city councils - places with large student or shared-housing markets - have designated additional schemes covering these smaller HMOs. This is entirely local, so you must check your council's own designation.
Step 3: Is it a single-household let in a designated area?
If you let to a single family or one household, HMO rules do not apply. But your property could still need a licence under a selective licensing scheme, which covers ordinary privately rented homes in a specific ward or street list. Selective schemes are used to tackle poor housing conditions, low demand or antisocial behaviour in a target area. Since 1 April 2015 (updated December 2023), a council must get government approval for any selective scheme covering more than 20% of its area or its private rented stock (gov.uk: selective licensing).
Step 4: None of the above?
If your let is a single household, in an area with no selective scheme, and is not an HMO, you very likely need no property licence at all in England. Still confirm with the council, because designations change and start dates matter.
Worked example: the cost of getting it wrong
Licence fees are set locally and vary a lot. As a budgeting example, suppose your council charges £900 for a five-year HMO licence. Annualised, that is £180 a year - a modest, predictable operating cost you can build into your figures.
Now weigh that against the downside. Renting out a property that should be licensed but is not is a criminal offence. A council can issue a civil penalty of up to £30,000 as an alternative to prosecution, and on prosecution the fine is unlimited.
The exposure that catches most landlords out is the Rent Repayment Order (RRO). A First-tier Tribunal can order you to repay up to 12 months' rent. Take a modest let at £1,200 a month:
- Monthly rent: £1,200
- Maximum RRO period: 12 months
- Potential repayment: up to £14,400
That single order dwarfs the £900 licence many times over, and the tenant (or the council, where housing benefit or Universal Credit was paid) can apply for it. Set beside a £180-a-year licence, the maths makes itself.
HMO standards you agree to by licensing
An HMO licence is not just a fee. It commits you to conditions, including national minimum sleeping-room sizes set by the 2018 mandatory conditions: at least 6.51 m² for one adult, 10.22 m² for two adults sharing, and 4.64 m² for a child under 10 (The Licensing of Houses in Multiple Occupation (Mandatory Conditions of Licences) (England) Regulations 2018). You will also typically face conditions on gas safety, electrical checks, fire precautions and the maximum number of occupants. Check these before you apply, not after.
How to check the local scheme before you let
Do this for every property, because schemes are drawn at ward or even street level:
- Search "[your council name] private rented property licensing" and open the council's housing pages.
- Look for a "check if you need a licence" tool or a map or list of designated areas. Many councils let you enter a postcode.
- Confirm the scheme's start and end dates - a designation that has lapsed or not yet begun changes your position.
- If it is unclear, email the private-sector housing team with the full address and ask in writing. Keep the reply.
Never rely on what applied to a similar property last year. Additional and selective designations run for up to five years and are renewed, replaced or dropped, so the answer genuinely can change.
A note on why this matters more from 2026
Historically, one hidden penalty for an unlicensed let was that you could not serve a valid Section 21 "no fault" notice. Under the Renters' Rights Act 2025 (Royal Assent 27 October 2025), Section 21 was abolished and the tenancy reforms commenced on 1 May 2026, so that particular lever is going. But the financial penalties - civil penalties, unlimited fines and Rent Repayment Orders - remain firmly in place, and enforcement is not softening. Licensing compliance is becoming more important, not less.
Wales, Scotland and Northern Ireland
This guide covers England. The devolved nations run different regimes. In Wales you must register and be licensed through Rent Smart Wales to let or manage a property. In Scotland every private landlord must join the council's landlord register, with separate HMO licensing on top. In Northern Ireland there is a landlord registration scheme plus council-run HMO licensing. If your let is outside England, start with the relevant national scheme rather than the rules above.
This is general information, not tax or financial advice. Licensing rules and fees are set locally and change, so always confirm the current position with the council for your specific property before you let.
