How to Rent Your Property to the Council: Complete Guide

Last Updated: October 16th 2025 | Reading Time: 15 minutes

Key Takeaways:

• Guaranteed Income, But at a Cost: Council schemes offer guaranteed rent but typically pay 10-30% below market rates.
• Long-Term Commitments: Most council leases require a 3-5 year commitment, reducing your flexibility.
• Attractive Incentives: Councils offer significant cash incentives (£10k-£15k) and grants (up to £80k) to attract landlords.
• High Property Standards: Your property must meet strict compliance standards, including EPC ratings and safety certificates.
• Guaranteed Rent as a Better Alternative: Companies like AMS Housing Group offer the same security as councils but with higher rental income, more flexibility, and superior service.

If you own a property in the UK and are considering renting it to your local council, you’re exploring secure letting options with guaranteed income. While councils do offer incentives and stability, it’s important to understand exactly what you’re signing up for—and whether there are better alternatives available.

In this comprehensive guide, we’ll walk you through everything you need to know about council rental schemes, the trade-offs involved, and why many landlords are choosing guaranteed rent companies like AMS Housing Group instead. We’ll help you make an informed decision about which option truly works best for your circumstances.

Understanding Council Housing Schemes

The council housing landscape has evolved significantly in recent years. Local authorities across the UK are actively seeking private landlords to help address the growing demand for affordable housing, particularly in the wake of recent legislative changes including the Renters Rights Act.

What is Council Housing?

Council housing schemes allow local authorities to provide affordable social housing to people who cannot access private sector rentals. To meet this demand, councils partner with private landlords through various arrangements, creating a win-win situation: landlords receive guaranteed income, while councils gain access to much-needed housing stock.

Two Main Types of Council Rental Agreements

1. Private Sector Leasing (PSL)

Private Sector Leasing is the most comprehensive option where you lease your property directly to the council for a fixed period, typically 3-5 years (though some councils offer 10+ year agreements). The council becomes your tenant, taking full responsibility for:

• Finding and vetting sub-tenants
• All property management
• Maintenance and repairs
• Utility bills and council tax
• Guaranteed rent payments, including during void periods

2. Assured Shorthold Tenancy (AST)

A more flexible option where the council nominates tenants for your property, but you retain more control. These typically run for minimum 12-month periods with standard tenancy agreements.

The key difference: With PSL, the council is your tenant. With AST arrangements, the council’s nominee is your tenant, and you retain more direct involvement.

Why Councils Need Your Property

Local authorities are facing unprecedented demand for housing due to:

• Rising homelessness figures across the UK
• Reduction in social housing stock
• Changes to private rental sector regulations
• Increased costs of temporary accommodation (hotels, B&Bs)

Multiple councils have reported that they’re actively seeking private landlords to help tackle housing crises. This strong demand has led to attractive incentive packages for participating landlords.

Benefits of Renting Your Property to the Council

Guaranteed Rental Income

The most significant advantage is receiving guaranteed rent payments directly from the council—a reliable tenant with financial stability. Unlike private tenancies where you risk arrears or non-payment, council payments arrive consistently on the agreed date.

Even during void periods (when no tenant occupies the property), you continue receiving rent. This eliminates one of the biggest financial risks facing private landlords.

Long-Term Stability

Council agreements typically span 3-5 years, providing long-term security and predictable cash flow. This stability is particularly valuable in uncertain economic times and helps with financial planning, whether for mortgages, retirement, or investment strategies.

Professional Property Management

Councils typically handle all day-to-day management responsibilities, including:

• Tenant selection and vetting
• Rent collection
• Property inspections
• Maintenance coordination
• Tenant support services

This significantly reduces your administrative burden compared to managing private tenancies. For more on what property management entails, see our guide on what services do property management companies offer.

Reduced Risk

With the council as your tenant, you’re protected from common landlord headaches:

• No chasing late rent payments
• No costly eviction procedures
• No void period losses
• Professional handling of tenant disputes

To understand more about the rental amounts you can expect, see our detailed guide on how much councils pay to rent properties.

Important Note: While these benefits are attractive, they come with trade-offs. Council rental rates are typically 10-30% below market value, and you’ll be locked into 3-5 year commitments. Many landlords find that guaranteed rent companies offer similar security with better rates and more flexibility—we’ll explore these alternatives later in this guide.

Council Incentives for Landlords

One of the most significant recent developments is the range of financial incentives councils are offering to attract landlords to their schemes.

Cash Incentives

Many councils now offer upfront cash payments:

• Up to £10,000: Standard PSL scheme incentives for 3-5 year leases
• Up to £15,000: Premium incentives offered by some councils for property improvements and longer commitments
• £500 per year of lease: Some councils offer annual upfront payments

Empty Homes Grants

If you own a property that’s been vacant for an extended period, you may qualify for substantial renovation grants:

• Up to £80,000: Available from some London boroughs
• £40,000: Offered by several major councils
• £25,000+: Available in various areas

These grants help bring empty properties up to lettable standards, with the requirement that you lease through the council’s scheme for a minimum period (typically 3 years).

Additional Benefits

• Free insurance: Up to two years of rent loss and tenant damage insurance
• Property improvement grants: Funding for necessary upgrades to meet council standards
• Licensing fee exemptions: Some councils waive private landlord licensing fees for PSL participants
• Free property management: Full management service at no cost to you

Real Examples from Recent Schemes

Greenwich Council: Completely free participation with no fees or commissions, rents paid at Local Housing Allowance rates, grants up to £15,000 for improvements, and guaranteed rent for the entire lease period including voids.

Maidstone Council: PSL scheme offering 3-5 year leases with guaranteed monthly income, free professional property management, and the council taking responsibility for repairs, council tax, and utilities.

Eligibility Criteria for Renting to Councils

To participate in council rental schemes, you and your property must meet specific requirements.

Property Standards

Your property must meet the council’s housing standards, which typically include:

• Decent Homes Standard: Property must be in good repair, reasonably modern, and provide reasonable degree of thermal comfort
• Health and Safety Rating System (HHRS): No Category 1 hazards present
• Adequate facilities: Proper kitchen, bathroom, heating, and hot water
• Appropriate size: Meeting minimum space standards for intended occupancy

Energy Performance Requirements

Current Requirements:

• Minimum EPC rating of Band E required for all rental properties
• Properties rated F or G cannot be legally let unless an exemption is registered

Proposed Future Changes:
Following recent government consultation, new proposals suggest:

• Band C requirement for new tenancies from 2028
• All tenancies must be Band C compliant by 2030
• Cost cap of £15,000 per property (potentially £10,000 with affordability exemption)

Council properties must meet the same minimum standards as private rentals. Consider upgrading your EPC rating now to future-proof your investment. For more on EPCs, see our guide on when did EPC become law for lettings.

Landlord Requirements

• Registration: Must be registered with your local council as a landlord
• Right to Rent: Proof of ownership and legal right to rent the property
• Financial standing: Some councils conduct basic financial checks
• Clean record: No serious breaches of housing regulations or unresolved disputes

Location Requirements

Properties must be located within (or sometimes near) the council’s jurisdiction. Some councils will consider properties in neighboring boroughs if they help meet specific housing needs.

Required Certificates and Documentation

You’ll need current, valid documentation including:

• Energy Performance Certificate (EPC)
• Gas Safety Certificate (annual)
• Electrical Installation Condition Report (EICR) – required every 5 years
• Proof of property ownership
• Building insurance documentation

For a complete understanding of your compliance obligations, review our guide to landlord certificates.

How to Apply: Step-by-Step Process

Before you proceed: This section explains the council application process for informational purposes. However, the process can be lengthy (2-3 months), requires significant documentation, and commits you to 3-5 years at below-market rates.

Want a simpler alternative? AMS Housing Group can have you set up with guaranteed rent in as little as 2-3 weeks, with flexible terms and better rates. Get a free valuation here or use our calculator below.

If you still want to explore the council route, here’s how it works:

Step 1: Research Your Local Council’s Scheme

Start by visiting your local council’s website or GOV.UK to find information about their specific schemes. Different councils operate under different names:

• Private Sector Leasing (PSL)
• Rent Guarantee Scheme
• Private Rented Sector Scheme
• Let to [Council Name] scheme

Each will have specific requirements, incentives, and application processes.

Step 2: Make Initial Contact

Contact your council’s housing or private sector housing team. Prepare to provide:

• Property address and postcode
• Number of bedrooms
• Property type (flat, house, maisonette, etc.)
• Current condition and any recent improvements
• Your availability for property viewing

Most councils have dedicated teams handling landlord inquiries. Response times vary, but expect initial contact within 5-10 working days.

Step 3: Property Assessment

The council will arrange an initial assessment, either through:

• Desktop review: Based on photos and information you provide
• In-person viewing: Council officer visits to assess suitability

They’ll evaluate:

• Whether the property meets their current housing needs
• Size and configuration suitability
• Location and local amenities
• General condition and any obvious issues

Step 4: Formal Property Inspection

If your property is suitable, a formal inspection will be scheduled. A qualified housing officer will check:

• Structural condition
• Electrical safety
• Gas safety
• Damp, mold, or condensation issues
• Fire safety measures
• Security (locks, windows)
• General repair state

The inspector will identify any issues that need addressing before the property can be leased. Minor issues may be acceptable with agreement to rectify them.

Step 5: Negotiate Terms

Once your property passes inspection (or you’ve agreed to make necessary improvements), you’ll negotiate:

Rental Amount:
Councils typically pay at Local Housing Allowance (LHA) rates for your area and property size. While this may be 10-30% below peak market rates, remember you’re gaining guaranteed income with zero void periods and full management services.

To understand current rates for your area, consult our detailed guide on council rental payments.

Lease Length:

• Minimum 3 years for PSL schemes
• Often 5 years with option to extend
• Some councils offer 10+ year agreements with enhanced terms

Maintenance Responsibilities:
Clarify exactly what the council will handle versus your ongoing responsibilities.

Payment Terms:

• Payment date (usually first week of the month)
• Payment method
• Advance or arrears payment

Step 6: Sign the Agreement

Review the lease agreement carefully. Consider having a solicitor review it, particularly for long-term commitments. Key clauses to understand:

• Rent review mechanisms
• Break clauses (if any)
• Maintenance responsibilities
• Property return conditions
• Notice periods
• Dispute resolution procedures

Once signed, the council typically takes possession within 2-4 weeks.

Step 7: Property Handover

Before handover:

• Complete any agreed remedial works
• Provide all required certificates
• Complete a detailed inventory
• Arrange insurance
• Set up payment details

The council will usually conduct a final check-in inspection and photograph the property’s condition.

Understanding Local Housing Allowance (LHA)

Local Housing Allowance determines the maximum housing benefit payable for private rentals in your area. Councils typically use LHA rates as the basis for rental payments in their schemes.

How LHA Rates Work

• Broad Rental Market Areas (BRMA): UK is divided into geographical areas with specific rates
• Property size categories: Rates vary by bedroom count (1-bed, 2-bed, etc.)
• Annual review: Rates are reviewed yearly (though frozen in some years)

Finding Current LHA Rates

You can check your specific area’s rates using the LHA Direct postcode search.

LHA rates are published annually by the government and are used by the Department for Work and Pensions to calculate Housing Benefit for tenants renting from private landlords.

Property Standards and Compliance

Maintaining proper standards and compliance is non-negotiable when renting to councils.

Health and Safety Requirements

Gas Safety:

• Annual Gas Safety Certificate required
• Qualified Gas Safe registered engineer must perform inspections
• All gas appliances must be safe and well-maintained

Electrical Safety:

• Electrical Installation Condition Report (EICR) every 5 years
• All electrical installations must meet current standards
• Portable appliance testing (PAT) for any provided electrical items

Fire Safety:

• Smoke alarms on every floor
• Carbon monoxide alarms in rooms with solid fuel appliances
• Fire doors where required (especially HMOs)
• Clear escape routes

General Safety:

• No Category 1 hazards under HHRS
• Secure locks on external doors and windows
• Safe stairs and balconies
• No serious damp or mold issues

For complete information on required documentation, see our guide to landlord certificates.

Licensing Requirements

Depending on your property and location, you may need:

Selective Licensing:
Applies to all private rented properties in designated areas. Check if your local authority has selective licensing schemes in place.

Additional HMO Licensing:
Required for smaller HMOs (3-4 unrelated occupants) in designated areas.

Mandatory HMO Licensing:
Required for properties with 5+ unrelated occupants sharing facilities.

Some councils waive licensing fees for landlords participating in PSL schemes—ask about this benefit. For more on licensing, see our landlord licensing page.

Managing Your Council-Rented Property

Maintenance Responsibilities

Council’s Responsibilities (typical PSL arrangement):

• Day-to-day repairs
• Tenant-caused damage (beyond wear and tear)
• Internal decorating
• Garden maintenance
• Appliance repairs (if provided)

Your Responsibilities:

• Structural repairs
• External maintenance (roof, walls, windows)
• Boiler/heating system replacement (if beyond economical repair)
• Major renovations
• Buildings insurance

Always clarify these details in your specific agreement as arrangements can vary by council.

Inspections and Reporting

Most councils conduct regular property inspections:

• Initial period: Every 3-6 months
• Established tenancies: Every 6-12 months

You may also request to inspect your property with reasonable notice (typically 24-48 hours).

Dealing with Issues

If problems arise, your first point of contact is your council liaison officer. The council is responsible for managing tenant issues and coordinating repairs. This is a significant advantage over private letting, where you’d handle these issues yourself.

Council vs. Guaranteed Rent Companies: Which is Better?

“I was tempted by the council’s cash incentive, but the 5-year lock-in and low rent were deal-breakers. AMS offered me a better rate on a 2-year contract, and they’ve been fantastic. The process was quick, and I have a direct contact who always picks up the phone.”

— Trudy Obode, Finsbury Park landlord

Which Option is Right for You?

For most landlords, guaranteed rent companies like AMS offer the optimal solution: you get the security and guaranteed income of council letting, but with better rates, more flexibility, and superior service.

Choose Council Direct if:

• You need access to property improvement grants (£15,000+)
• You’re comfortable with 3-5 year commitments
• You’re willing to accept 10-30% below market rates
• Your property needs significant work to meet standards

Choose AMS Guaranteed Rent if:

• You want guaranteed income WITHOUT below-market rates
• You prefer flexibility (12-month minimum vs 3-5 years)
• You value direct communication and personal service
• You want to maximize your rental income while minimizing risk
• You prefer a streamlined setup process

To explore whether guaranteed rent is right for your property, visit our guaranteed rent page or read our detailed comparison of guaranteed rent vs traditional letting.

Exit Strategies and Ending Your Agreement

Notice Periods

Standard PSL agreements require:

• Landlord serving notice: Typically 6 months minimum (often only at agreement end)
• Council serving notice: Usually 3-6 months
• Break clauses: Rare in PSL agreements, but some allow breaks after initial period

Always check your specific agreement terms.

End of Agreement Process

When your council lease ends:

1. Provide formal notice: Follow agreement terms precisely
2. Final inspection scheduled: Council will arrange property check
3. Dilapidations assessment: Document any damage beyond wear and tear
4. Property returned: Usually within 4 weeks of agreement end
5. Financial settlement: Any outstanding payments or dilapidations resolved

Property Condition Expectations

The council will return your property in:

• Reasonable decorative state (wear and tear expected)
• Good repair (unless structural issues arose)
• Clean and clear of tenant belongings

Major structural issues or damage may be subject to negotiation based on agreement terms and responsibilities.

Transitioning to Private Letting

If you plan to move to private letting after your council agreement:

• Start marketing 2-3 months before agreement end
• Update all safety certificates
• Consider any refurbishment or updating
• Arrange appropriate insurance
• Set up new management arrangements

Frequently Asked Questions

Can I rent multiple properties to the council?

Yes, many councils actively seek landlords with multiple properties and may offer enhanced terms for portfolio landlords. Some offer dedicated account managers for larger portfolios.

What happens if the council wants to end the agreement early?

Most PSL agreements are fixed-term with no early termination unless specified conditions are met. Check your agreement for break clauses. The council typically provides 3-6 months notice if they have an early termination right.

Can I inspect my property during the council tenancy?

Yes, you usually retain the right to inspect your property with reasonable notice (typically 24-48 hours). Most councils conduct regular inspections and will share reports with you.

What if I disagree with the council about maintenance or dilapidations?

Most agreements include dispute resolution procedures. Start with your council liaison officer, escalate to senior management if needed, and ultimately mediation services are available. Many councils are members of ombudsman schemes.

Do council tenants damage properties more than private tenants?

There’s no evidence that council-nominated tenants are more likely to cause damage than private tenants. Councils conduct thorough vetting and provide tenant support that can actually reduce issues. Remember, the council typically assumes responsibility for tenant-caused damage anyway.

Can I sell my property during a council lease?

Yes, but the lease transfers to the new owner. This can be attractive to some buyers (guaranteed income) or off-putting to others. Always disclose the council tenancy to potential buyers.

Are there tax differences between council and private letting?

No, rental income is taxed the same way regardless of whether your tenant is the council or a private individual. Standard landlord tax rules apply. For more information, see our guide on tax on rental income.

What about Universal Credit and housing benefit changes?

When renting directly to the council via PSL, you’re insulated from benefit changes—the council pays you directly regardless of the tenant’s benefit status. This is a significant advantage over private lettings where you may face payment delays or issues.

Conclusion

While renting directly to the council through PSL schemes offers security and guaranteed income, it comes with significant trade-offs: rental rates 10-30% below market value, long-term commitments of 3-5 years, and limited flexibility. For many landlords, these compromises may not be necessary.

There’s a better way.

AMS Housing Group provides all the benefits of council letting—guaranteed rent, zero void periods, professional management—but with competitive rates that sit between council LHA rates and market value, flexible lease terms from just 12 months, and a more hands-on, personalized service.

Why Choose AMS Housing Group?

Unlike direct council letting, we offer:

• Higher rental income than council LHA rates
• Flexible lease terms starting from 12 months (not 3-5 years)
• 0% commission and no hidden fees
• Free maintenance included
• Faster setup without lengthy council processes
• Direct communication with dedicated property managers
• Guaranteed rent even during void periods

We understand that every landlord’s situation is unique. Whether you’re considering council letting or exploring your options, we can provide expert guidance and a solution tailored to your needs.

Get Your Free Property Valuation

Don’t settle for below-market rates and long-term commitments. Discover what your property could earn with AMS Housing Group’s guaranteed rent service.

Contact our expert team for a free, no-obligation consultation and property valuation.

We’ll help you understand:

• Your guaranteed rental income potential
• How our service compares to council direct and traditional letting
• The best solution for your specific circumstances
• All costs and terms transparently explained

Call us today or request a valuation to see how much you could be earning with guaranteed rent that works for you—not just for the council.