Landlords and letting agents are being warned to keep track of local property licensing rules after the maximum penalty for operating a property without a required licence increased to £40,000.
Propertymark says the combination of higher penalties and a growing number of selective and additional licensing schemes is making compliance increasingly complex across England.
The maximum civil financial penalty for relevant Housing Act offences increased from £30,000 to £40,000 when the first phase of the Renters’ Rights Act 2025 came into force on 1 May.
Offences include operating a house in multiple occupation (HMO) or other property without the required licence and failing to comply with licence conditions.
LOCAL LICENSING
Councils including Ealing, Preston, Burnley and the Royal Borough of Greenwich are consulting on licensing changes, with proposed fees ranging from hundreds of pounds to more than £1,000 per property.
Some local authorities are also considering additional HMO licensing and Article 4 Directions.
Propertymark warns the consequences of non-compliance can extend beyond civil penalties. Depending on the circumstances, responsibility for an unlicensed property can apply to those managing or controlling it and landlords further up a rent-to-rent chain.
Failure to obtain a required licence can also lead to a rent repayment order, with tenants and councils able to seek repayment of up to two years’ rent in relevant cases.
‘INCREASINGLY COMPLEX’
Tim Thomas (main picture, inset), Senior Policy and Campaigns Officer at Propertymark, says: “The regulatory landscape for the private rented sector is becoming increasingly complex, and the cost of getting compliance wrong is rising.
“Agents and landlords need to be absolutely clear about whether a property requires a licence, what conditions apply and who carries responsibility within the ownership and management structure.”
Propertymark is also concerned about potential duplication when the forthcoming Private Rented Sector Database is introduced.
Thomas adds: “With the PRS Database coming forward, now is the time for central government and local authorities to work together to make regulation simpler rather than adding another layer of bureaucracy.
“A national system should help councils identify non-compliance and support responsible landlords to demonstrate that they are meeting their obligations, not require the same information to be submitted again and again.”
