Property licensing is the Local Authority’s process of improving living standards in rental accommodation. There are different types of licence for different types of property.
The term ‘household’ in this sense refers to either a single person or members of the same family that live together.
The term ‘family’ includes:
Each ‘family’ within a property forms a separate household.
Find out more, on our WHAT IS AN HMO? property page.
Many clients ask us why they shouldn’t just wait for the council to inspect and then do any work necessary.
Our advice is that although there is nothing to stop you doing this, it is important to fully understand what you are signing when you apply for a licence.
To initially apply for the licence you only require:
However, in order to be issued a licence without conditions you will require some or all of the following:
In some cases you will be asked for more of the above certification on application.
If you let a property that requires a license but doesn’t have one:
Even though your property is managed, the owner of the property is responsible for applying for a licence unless the agent has agreed to be the licence holder.
However, it is a good idea to get organised with all required documentation to ensure you can apply as soon as tenants move in.
Types of licence:
Mandatory HMO Licensing
An HMO with 5 or more unrelated persons, from more than one household, sharing facilities will require a mandatory licence. This applies to all HMO properties in England however there are exemptions to the rule. Find out more about Mandatory HMO Licensing here.
Additional HMO licensing
Any HMO that doesn’t fall under the mandatory scheme may need this type of HMO licence. This is not an England & Wales-wide scheme and only some councils have this in place over the whole borough or in certain wards, streets or postcodes. Find out more about Additional HMO Licensing here.
A number of councils have included Section 257 HMOs within their Additional licensing schemes. These are whole buildings that:
Selective property Licensing
Selective licensing schemes apply to any let property in wards, postcodes or streets chosen by your local authority, regardless of the way they are tenanted. This can include single family homes.
At present there is not a solid guideline that covers all councils, but our recommendation and practice is to do the following:
The exact requirements will vary per property with a huge number of influencing factors, but here are some basic fire safety standards you may need for your residential property.
Automatic Fire Detection System (AFD)
A mains wired, interlinked system is a minimum standard under the LACORS guidelines and is recommended be installed and tested by a 3rd party accredited company, BAFE is an example of accreditation these companies will have.
Whether fire doors are required depends on the layout of the property, how complex the escape route is and the risk level identified. It would be very unusual to require fire doors on bedrooms in a 3 person shared house, but if a kitchen leads onto the escape route you are likely to require a fire door to the kitchen.
These should be installed by a 3rd party accredited contractor, BM Trade Q-Mark is an example of accreditation these companies will have..
Fire extinguishers and fire blankets
These are required under the LACORS guidelines, fire extinguishers must be correctly installed and tested annually by a 3rd party accredited company, BAFE is an example of accreditation these companies will have.
Fire Safety Risk Assessment
All HMO’s require a Residential Fire Safety Risk assessment under the Regulatory Reform (Fire Safety) Order 2005. They are also required for the common parts of buildings divided into flats.
These can be carried out by the licence holder if they declare themselves a competent person, however it is very important they have a comprehensive understanding of the legislation.
If an accident occurs and the assessment is thought to be insufficient, the Responsible Person can face an unlimited fine or up to two years in prison.
To absolutely prove competence, Fire Risk Assessors should be members of the Institute of Fire Safety Managers, and have completed risk assessment courses accredited by the institute.
By signing as the licence holder, you’re taking on the responsibility of ensuring the relevant fire safety and health and safety standards are being complied with.
The Management of Houses in Multiple Occupation Regulations 2006
Details the responsibilities of the licence holder and tenants. These requirements also apply to Selective licensing under many councils. The legislation puts the responsibility on the licence holder to ensure the property complies with fire safety and health and safety standards.
LACORS fire safety guidance
Published with the support of local government and the Association of Chief Fire Officers, this is the standard used by Local Authorities to determine fire safety measures. Regardless of the type of property, this guidance will help you determine a satisfactory level of fire protection.
Regulatory Reform (Fire Safety) Order 2005 (HMOs only)
The Order applies to almost all buildings, including HMOs. It emphasises risk reduction and fire prevention and requires licence holders to have a detailed fire risk assessment of their properties carried out.
Alongside these, each council will outline their particular expectations from landlords.
(e.g. Hammersmith and Fulham council’s “Standards and Guidance for houses in multiple occupation”)
This is a common question from clients, as it’s easy to fill out the application, but difficult to work out exactly what’s required. For example if your property is an HMO it will require a Fire Safety Risk Assessment with your application. We can do one for you even if you have already submitted an application.
We also do a “reports only” service for any type of licence- this is where we inspect the property in the same way as the council would and highlight any areas which do not meet legal requirements. This way you are able to get your property up to scratch in a sensible timeframe, without the costs associated with having to work to a tight deadline.
If agents are deemed to be a “rent receiver” or “manager” of an unlicensed property, or a property in breach of the 2006 HMO management regulations, they can face prosecution along with the landlord.
A ‘rent receiver’ is the party that gets the money from tenants in the first instance, which is typically estate agents when it comes to managed properties.
This is a complicated section of the law and agents should seek legal advice if in any doubt.
In some boroughs the licence holder of a property licence must be based in the U.K. This is because one of the expectations of licence holders is to regularly visit the property to do necessary checks and maintenance to ensure it meets the 2006 HMO Management regulations, and the 2005 Fire Safety Order for the entirety of the licence scheme.
By taking on the licence an individual is stating legally that the property is compliant and takes responsibility to ensure that it will continue to meet the requirements for the entire course of the licensing scheme.
The licence holder is therefore liable to penalties if the property is found to be in breach of legislation during its initial council inspection or during any visit for the length of the scheme (e.g. following a complaint from a tenant). Currently, a breach of any conditions of the licence is usually £5000 per individual condition.
For this reason, agents and friends are often reluctant to take on responsibility for holding a licence.
If you need any further advice or would like a quote for holding your licence please get in touch.
Any UK-based individual, company or charity can hold your licence. Therefore a family member, friend, or your managing agent (if applicable) can theoretically be the licence holder, however all parties must understand their legal responsibilities.
We offer a licence holding service, providing we have been able to inspect the property, and have agreed that it meets the required specification and will continue to meet the guidance moving forward.
We provide an end-to-end service helping London’s landlords comply with new property legislation. We ensure that our client’s properties meet the required level of fire safety and living standards and provide a hassle-free alternative to lengthy licence applications.
To our knowledge we are the only company to provide a comprehensive property licensing management service across all London boroughs.
We can help with any element of your property licensing journey.
If you need help or advice, please don’t hesitate to get in touch.