A new report from Direct Line Group reveals a 9.3% increase in selective licensing schemes from 2022 to 2024. Here’s what letting agents need to know.
A Freedom of Information (FOI) request by Direct Line found that the number of selective licenses issued by councils has increased by 9.3% over the past two years. Currently, 47 councils in England have selective licensing schemes that letting agents and landlords must comply with.
This report provides insights into which councils have introduced new selective licensing schemes and the associated application costs.
Letting agents need to stay updated on these schemes in each local authority to avoid prosecution or hefty fines.
- Which councils have selective licensing schemes?
- How much does each scheme cost?
- What is the average of a selective license fine?
- How can letting agents keep track of each scheme?
Which councils have selective licensing schemes?
Out of 317 councils, 245 responded to Direct Line’s FOI request, with 47 confirming they currently have selective licensing schemes. However, this only covers a portion of selective licenses, with no definitive number of selective license schemes in England.
The report highlights that Peterborough, Merton, Charnwood Borough, and Birmingham have introduced new schemes within the last two years.
Keeping track of these ever-changing schemes can be challenging for letting agents, especially during busy periods. Without the right processes in place, staying updated on new schemes becomes an additional burden.
Kamma simplifies this by using industry-leading technology to monitor every new scheme introduced by local authorities. As of May 2024, Kamma has identified 25 newly launched licensing schemes, with three more under consultation across England.
Goodlord’s integration with Kamma allows agents to easily check licensing requirements for all registered properties, eliminating the need to visit multiple local authority websites.
How much does each scheme cost?
Direct Line’s report reveals that councils charge an average of £700 per mandatory licensing scheme. However, costs can vary significantly across England, affecting landlords' and letting agent's costs per area.
The report highlights the councils with the highest charges:
- Leicester City Council: £1,290 per scheme
- Newcastle upon Tyne City Council: £900 per scheme
- London Borough of Greenwich: £858 per scheme
- Oadby & Wigston District Council: £840 per scheme
- Middlesbrough Borough Council: £823 per scheme
To find out whether a private rental property requires a selective license, download our info sheet
What is the average selective license fine?
Determining an average fine for selective licensing violations is challenging, much like estimating the cost of individual licenses. However, Direct Line’s report found that English councils collected £2.5 million in fines in 2023, an 80% increase from 2022.
According to the report, non-compliant landlords and agents can face fines of up to £10,000 per property. For instance, a landlord or agent with five unlicensed properties could be fined up to £50,000.
It's not just landlords and managing agents at risk. Liverpool City Council secured a banning order against a rogue agency, imposing fines totalling £259,696.17 on the agency and its associated companies.
How can letting agents keep track of selective licensing schemes?
Selective licensing requirements vary by location, so a letting agent with properties on different streets may need separate licenses for each property.
Agents need to be up-to-date on new or changing licensing schemes in the areas they operate in.
Goodlord customers can avoid checking multiple local authority websites, as our platform provides the necessary information on selective licensing requirements.
