Selective Licensing for Landlords | Coopers Inventory Services

Selective Licensing is a form of property licensing that allows local authorities in England to require landlords of privately rented properties within a designated area to obtain a licence.

Unlike Mandatory HMO Licensing and Additional HMO Licensing, Selective Licensing isn't limited to Houses in Multiple Occupation.

It can apply to ordinary privately rented houses and flats occupied by a single household where the property falls within an area designated by the local council.

This means a landlord could own a perfectly ordinary two-bedroom rental property occupied by one family and still require a property licence because of where the property is located.

For landlords, letting agents and property managers, checking local licensing requirements should therefore form part of managing any privately rented property.

Selective Licensing was introduced under Part 3 of the Housing Act 2004.

Under Section 80 of the Act, a local authority can designate all or part of its area as subject to Selective Licensing.

Where a designation applies, privately rented properties within the designated area generally require a licence unless they fall within an applicable exemption or another relevant licensing regime.

The crucial distinction is:

Selective Licensing is about the property and its location — not simply whether it is an HMO.

Mandatory HMO Additional HMO Licensing Selective Licensing

Licensing

Applies to Certain larger HMOs Other HMOs Wider private

specified locally. rented housing.

National or local? National threshold Local scheme Local scheme

Can apply to a normal

family rental? No No Yes

Can rules vary by Core threshold national Yes Yes

location?

Check with local council? Yes Yes Yes

Councils can't simply introduce Selective Licensing without justification.

Current government guidance identifies six circumstances that can support a Selective Licensing designation:

The scheme is intended to help councils address identified problems within the private rented sector and improve property-management standards within the designated area.

Before 23 December 2024, larger Selective Licensing schemes could require confirmation from the Secretary of State.

That changed with the General Approval 2024.

Local housing authorities in England can now introduce Selective Licensing schemes of any size without obtaining individual Secretary of State confirmation, provided they satisfy the statutory requirements.

Councils are expected to consult affected people for at least 10 weeks before introducing a designation.

For landlords, the practical consequence is simple:

Don't assume that because your property didn't require a licence previously, it won't require one in future.

Local licensing schemes can be introduced, changed, renewed or revoked.

The exact answer depends upon the local scheme.

Where a council designates an area for Selective Licensing, privately rented properties within that designation can be required to obtain a licence, subject to statutory exemptions.

A property requiring licensing under Part 2 of the Housing Act 2004 as an HMO is generally dealt with through that HMO licensing regime rather than being separately licensed under Selective Licensing.

This means landlords need to establish:

1. Where is the property?

2. Is that address within a current Selective Licensing designation?

3. Is the property of a type covered by the designation?

4. Does an exemption apply?

5. Is the property instead subject to HMO licensing?

Because Selective Licensing is operated locally, landlords should check the website of the council responsible for the property's address.

Look for sections called:

Don't rely solely on what applied when the tenancy started or when the property was purchased.

This is particularly relevant for landlords with portfolios covering several locations.

A landlord might own properties in Warlingham, Croydon, Reigate and Caterham, for example, but those properties aren't necessarily subject to identical licensing requirements because they may sit within different local authority areas.

For Coopers' clients across Surrey and surrounding areas, licensing should therefore be checked property by property and council by council.

Licence requirements and conditions vary between councils, but the licensing process is designed to ensure that the property is appropriately managed and the proposed licence holder meets the relevant requirements.

Landlords may need to provide information concerning matters such as:

The proposed licence holder must also satisfy the applicable fit and proper person requirements.

Individual councils can impose licence conditions within the statutory framework, so landlords should read the actual licence rather than assuming requirements are identical everywhere.

A Selective Licensing designation itself can last for up to five years under the Housing Act framework.

Councils must review their schemes during their operation and can revoke a designation where appropriate. Current government guidance also asks councils to publish the outcomes of their reviews.

Individual property licences should therefore be checked for their actual commencement and expiry dates.

Again:

Don't assume “five-year scheme” automatically means your individual licence has exactly five years remaining.

No.

And even where a council operates Selective Licensing, it may cover only particular wards, streets or designated areas rather than the entire council area.

For example, current schemes elsewhere in England demonstrate how geographically specific these designations can be: Brighton & Hove's 2024 scheme initially designated four named wards, while Bexley's scheme designated the Belvedere ward.

That's why a postcode/address check is much more useful than simply asking:

“Does Surrey have Selective Licensing?”

There isn't one Surrey-wide landlord licensing rule

Operating a privately rented property without a required Selective Licence is an offence under Section 95 of the Housing Act 2004.

And again, we have the important 2026 penalty update.

From 1 May 2026, the maximum civil financial penalty available for relevant Housing Act 2004 offences increased from £30,000 to £40,000. The government's current civil-penalty guidance specifically includes an unlicensed property subject to Selective Licensing.

Important 2026 Update

The maximum civil financial penalty for relevant Housing Act 2004 offences increased to £40,000 from 1 May 2026.

Depending on the circumstances, other consequences can also arise, including prosecution and potential Rent Repayment Orders.

The safest approach is therefore to establish licensing requirements before letting or acquiring management responsibility for the property.

The fact that a tenancy began before a licensing scheme came into force doesn't necessarily mean the landlord can ignore the new scheme.

Where an existing privately rented property becomes subject to a new Selective Licensing designation, landlords should check:

Councils normally publish detailed information before a scheme takes effect.

Landlords shouldn't assume an existing licence simply passes automatically with the property.

Licences are granted to a particular licence holder under the statutory licensing framework.

If a licensed property is sold or management arrangements change, the incoming landlord or responsible party should contact the council and establish what new application or other action is required.

This is especially worth checking during the purchase of an investment property rather than discovering it after completion.

Selective Licensing schemes can place additional emphasis on professional property management, maintenance and record keeping.

Coopers Inventory Services provides independent written and photographic property reporting for landlords, letting agents and property managers throughout the tenancy lifecycle.

An Inventory & Schedule of Condition provides a detailed record of visible property condition at the beginning of a tenancy.

Mid-Term Property Inspections can provide a documented snapshot during occupation, recording visible deterioration, maintenance concerns or changes that may require further investigation.

A Check-Out Report then provides a further record of property condition at the end of the tenancy.

Coopers property reports are not Selective Licensing inspections and do not certify that a property complies with licence conditions, HHSRS requirements or other legislation.

Property owners and managers should check licensing requirements directly with the relevant local authority.