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More than 130,000 unlicensed rental homes in London

There are more than 130,000 unlicensed properties in London that should be licensed under either selective, additional or mandatory HMO licensing schemes, new research by London Property Licensing shows. 

The study, which was carried out on behalf of safeagent through Freedom of Information (FOI) requests, found there are over 310,000 private rented properties in the capital that require licensing under mandatory HMO, additional and selective licensing schemes implemented under the Housing Act 2004. 

Whilst the mandatory HMO licensing applies across England, additional and selective licensing schemes are introduced across London, although this varies depending on which borough it is located in.


But the study shows that non-compliance in London is rife, with licence applications having been submitted for just 25% of the 138,500 private rented properties that require licensing under mandatory HMO or additional licensing schemes. 

Without a licence application submitted, these properties are being operated illegally.

Lanldords caught operating an unlicensed property could face prosecution and a fine, or a civil penalty of up to £30,000. The landlord can also be ordered to repay up to 12 months rent. 

Somewhat concerningly, many landlords could simply be falling foul of the law through ignorance of the complex regulatory framework.

Since October 2018, the mandatory HMO licensing scheme has applied to most HMOs shared by five or more people whereas it was previously restricted to properties three or more storeys in height. 

In some London boroughs, additional licensing schemes have extended licensing to properties rented to just three or four unrelated people. 

The research revealed that licence applications have been submitted for 85% of the 173,000 private rented properties that require licensing under selective licensing schemes in London.

Added to the confusion over licensable properties, many London boroughs are struggling to process over 24,000 licence applications - a huge administrative burden that can lead to long delays in issuing licence approvals. Currently, about 40% of boroughs still rely on paper applications.

safeagent is calling for a simple, streamlined licensing process that would make it more cost effective for the public purse, easier for councils to enforce, and clearer for landlords and agents to understand whether a property should be licensed. 

Isobel Thomson, safeagent CEO, said: “The results of the survey are concerning. Consumers are not being well served and indeed many are being placed at risk through this mish mash of licensing schemes. Right now, the system isn't fit for purpose and Councils are drowning in paperwork. 

“Landlords needing property licences are either deliberately evading the schemes or are in the dark concerning their legal responsibilities and tenants are being placed at risk.

“If the compliance rate for HMO licensing schemes is only 25%, how can these schemes be effective? Ultimately this is about proper use of public money and consumer protection. Where are the assessment procedures for Councils who have schemes in place? 

“Isn't it time we went back to the drawing board to come up with a simple, streamlined system that works for all?"

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    Strange the head line doesn’t know the difference between 1’300

    Daniela Provvedi

    Yeah bloody ridiculous. I also noticed that.

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    • 14 October 2019 10:30 AM

    I've always wanted to know if you have a property now subject to Additional Licensing doess that mean that the BTL mortgage has to be converted to a HMO mortgage.
    This isn't something that a LL could avoid as it seems Councils inform LL of Additional Licensing.
    Though I guess a LL would be forced to reduce to two households if wishing to avoid Additional Licensing which must surely affect values for 3 bed properties!?

    Streamlining the system would be far better.
    So get rid of all Licensing schemes apart from one Cheap National one to cover ALL rental property.


    I would not object to the idea of a national licencing scheme if it were fair and the fees were also fair, but such a scheme would never be fair and would push rents higher still.

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    I believe the Council informed every man and his dog whether mentioned on the Application or not, including Bank / lender, freeholder if that’s not you, spouse , partner, maybe Insurance, my previous Solicitor that done purchase 20 years earlier that I didn’t mention, I Kay this because the Solicitor forwarded it to me. This is what they do with our License money, nothing to do with spending the money to improve the accommodation just draining the resources or life blood out of PRS.

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    • 14 October 2019 18:50 PM

    My National LL licensing scheme to replace all others was just a flippant comment.
    This is because I know only too well that the last thing Govt would want is a database of licensed LL.
    The reason would be that many LL would not be able to meet licensing requirements.
    This would result in hundreds of thousands of homeless tenants who the Councils would be obligated to house.
    Rogue LL are a vital party of the Govt's housing strategy.
    The last thing they need is knowledge of all LL.
    They know without National Licensing they can plausibly deny all knowledge of rogue LL and their defective properties knowing that as long as they aren't discovered they are at least housing their tenants rather than having the Council responsible for this.


    Paul, why ever did you not put your name forward for PM, I would have voted for you, come to that why not a landlord party standing for common sense .

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    Hard to imagine they want private LL’s out so much, so add another 130’000 LL’s to their Schemes at no cost to them. It’s lovely when you can make all the rules & never cost you a penny just keep load it onto LL’s, it’s not enough to pay 40% tax pay for everything do everything, worry & work yourself to death, they don’t care, ok license another 130’000 LL’s in L’don it’s about £1,100 fee alone x 130,000 =
    £143,000,000.robbed from the sector then turn around & do what they want, that will cost at least 3 times that again & £429,000,000 + our wear & tear 10% gone, Section 24, Section 21 rocking, Fee ban, Deposit debacle, Right to Rent, How to Rent. They do all this adversity in the name of helping PRS Housing, they really don’t give us much credit .

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    • 14 October 2019 23:32 PM

    @andrew Townshend
    Nah not interested in being a public figure.
    I have no ego whatsoever that needs massaging!
    We are just all realistic LL who know the reality of things.
    Unlike many other LL I am a surrender monkey.
    I admit Govt has defeated me as an AST LL.
    The threat of even more bonkers Labour policies is just the final straw.
    So my plan is to be a Lodger LL if possible though that is looking highly unlikely looking at the prices of 3 and 4 bed houses.
    Way above what I can afford.
    But at least I will receive some monthly savings interest from my sale proceeds to top up my pension.
    I feel sorry for all the LL determining to remain in the PRS.
    I hope they can cope with all the further c##p that is coming their way.
    I will return to the depths.
    My only interest will be in Lodgers LL issues
    My days of being a BTL LL will hopefully be shortly over.
    I don't envy those LL remaining who are going to have a fight on their hands..All in all such a shame as the PRS AST letting business was a good investment.
    But hey all good things come to an end.
    Mine lasted about 11 years.
    I will be no more in 3 years time.
    Good luck to tenants as they are going to need it!

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    Basically this tax is a scheme invented by idiots to get free money for nothing. Perceived benefits of the scheme are just oofle dust at a magic show. Discussing it is just empowering the idiots and inflating their self importance.

    Yes I know there are numerous property problems caused by skinflint landlords and diabolical tenants. Some have cost me a lot of money. If the licence fees supported something like a police force with real powers then I could see its worth but this idea that all tenants are innocents has to be put to bed forever. There are many criminals and unfortunately incompetents amongst them

    • 19 October 2020 10:45 AM

    If there was a National rental property licensing scheme then Councils could go after LL who haven't licenced.
    Even borderline criminal LL might still register as they would face RRO for letting unlicensed properties.

    It would be quite easy to catch out the criminal LL.
    Most of them won't have licences!!

    Councils can deal with these types first before moving on to checking licensed LL which they could do on a random basis so that no LL would know when their properties might be inspected.

    Good LL have nothing to fear from a CHEAP licensing system spread across the 9.5 million private rental properties.

    Potentially this will occur through the back door anyway when EVERY LL will be required to join the Property Redress Scheme.
    That would essentially be a LL Register in all but name!

    Would such a Register include Lodger LL!?


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