Licensing schemes increase the time and cost needed to manage your business. They have been brought in to tackle unscrupulous landlords, even though the majority of landlords already comply with the various laws governing tenants and rented properties.
It used to be just HMOs that needed licensing, but increasingly local authorities require landlords to be licensed for every property they rent out. It stems from the Housing Act of 2004, which came into force in April 2006 and allows local housing authorities the right to establish selective licensing schemes to regulate the private rented sector.
It is the landlord’s responsibility to know if licensing is required for their property and what the criteria are. To obtain one, a landlord must not only meet the standards set out in the scheme’s rules and regulations, but also adhere to them throughout the entire term of the licence. Failure to do so could result in severe penalties, with fines of up to £5,000 per offence.