Propertymark: Licensing schemes must not add to landlords’ regulatory burden

An industry body has warned licensing schemes must be “proportionate” rather than create unnecessary duplication.

Propertymark has warned landlords and letting agents of the financial consequences they could face if they fail to licence a property.

The warning comes as North East Lincolnshire Council has announced landlords face a £200 charge for missing the selective licensing deadline.

Licensing schemes must be proportionate

Tim Thomas, senior policy and campaigns officer at Propertymark, said: “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.

“Licensing can play a role in tackling poor standards and helping councils identify properties that require intervention, but schemes must be evidence-led, proportionate and properly enforced.

“Responsible landlords and professional agents should not be faced with unnecessary duplication, excessive administration or a patchwork of requirements that makes it harder to provide much-needed homes.”

Under the Renters’ Rights Act, civil financial penalties for relevant Housing Act offences increased from £30,000 to £40,000. This includes operating a House in Multiple Occupation (HMO) or other property without a required licence and failing to comply with licence conditions.

Another layer of bureaucracy

Under the Renters’ Rights Act, all landlords will also need to sign up for the PRS database, which will include information about their properties that tenants can access.

If a landlord lets or advertises a property without it first being registered on the database, they can be issued with a civil penalty of up to £7,000 or a £40,000 fine if they provide fraudulent information to the database.

While the government has previously claimed selective licensing and the PRS Database serve different purposes, Propertymark has warned that regulation should not add “another layer of bureaucracy”.

Mr 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.

“We are encouraging our members to engage with local consultations and tell us where new licensing schemes are creating additional costs, administrative burdens or risks to rental supply. This evidence is vital in ensuring regulation delivers better housing outcomes rather than simply increasing the regulatory burden.”