Selective Licensing
Selective licensing is a scheme created by a local housing authority under Part 3 of the Housing Act 2004 that requires every landlord letting a privately rented residential property within a designated area to hold a valid licence for that property. Unlike mandatory HMO licensing, which applies nationally to any HMO with five or more occupants from two or more households, selective licensing applies to all categories of private residential property in the designated area, including single-let houses, flats, and smaller HMOs that do not require a mandatory licence. A landlord with five properties in a selective licensing zone needs five separate licences, one per property.
Selective licensing sits alongside mandatory HMO licensing and additional HMO licensing as one of three forms of property licensing in England. A property that already holds a mandatory or additional HMO licence is exempt from selective licensing, a landlord cannot be required to hold both simultaneously for the same property.
When a council can introduce selective licensing
A local housing authority can only designate an area for selective licensing where it can demonstrate one or more of six statutory grounds set out in the Housing Act 2004:
low housing demand;
significant and persistent anti-social behaviour;
poor housing conditions;
high levels of migration;
high levels of deprivation; or
high levels of crime.
The designation must also confirm that selective licensing will contribute to a comprehensive strategy for addressing those issues alongside other measures, licensing alone is not sufficient justification.
Until December 2024, councils were also required to obtain approval from the Secretary of State before introducing a scheme covering more than 20% of the authority's geographical area or more than 20% of its privately rented properties. That requirement was removed in December 2024, substantially reducing the administrative barrier to introducing new schemes. As of 2026 there are over 60 active selective licensing schemes in England alone, and the number is increasing. Major cities including Liverpool, Nottingham, Leeds, and several London boroughs have introduced or expanded schemes since 2024.
Who needs a licence
Any person who is the landlord of a privately rented residential property within a designated selective licensing area must hold a valid licence for that property from the date the scheme comes into force. The requirement applies from the designation date, landlords already letting when a new scheme launches typically have a short transitional window to apply, but this varies by scheme and should not be assumed. The licence is property-specific, not landlord-specific.
The following categories of property are exempt from selective licensing: social housing managed by a local housing authority or registered social landlord; purpose-built student accommodation where the educational institution is the landlord; properties let under certain agricultural tenancies; and properties already licensed under mandatory or additional HMO licensing.
Where a property falls within both a selective licensing zone and an additional HMO licensing scheme, only the HMO licence is required, but it must be the correct type for the property.
Licence conditions and costs
Selective licences are typically valid for up to five years and impose conditions relating to property management, including standards for gas safety, electrical safety, and fire safety; requirements for tenancy agreements; and obligations around dealing with anti-social behaviour by tenants. Licence conditions vary between schemes and are set by each local authority. Fees also vary, schemes typically charge between £300 and £1,000 per property, though some larger urban schemes charge more.
From 1 May 2026, landlords in designated selective licensing areas will also need to comply with PRS Database registration requirements once the database is operational, both obligations will run simultaneously.
Consequences of non-compliance
A landlord who lets a property in a selective licensing area without a valid licence commits a criminal offence under the Housing Act 2004. The local housing authority can impose a civil penalty of up to £30,000 per offence, or pursue prosecution, which can result in an unlimited fine. Non-compliance also has direct tenancy consequences: a landlord letting without a required licence cannot serve a valid Section 8 notice on most grounds, and the tenant may be entitled to apply to the First-tier Tribunal for a Rent Repayment Order covering up to 24 months' rent under the Renters' Rights Act 2025.
For a full explanation of the penalties and sanctions available under the licensing enforcement framework, see the August definition of enforcement action.
The fastest way to check whether a specific property requires a selective licence is the August selective licensing checker, enter a postcode to see whether a scheme is active in that local authority area.
August's compliance checklist tracks selective licensing expiry dates and renewal windows alongside gas safety, EICR, and EPC obligations, so no licence deadline is missed across a portfolio.
For a complete guide to how selective licensing works, including how to apply, what the licence conditions involve, how much schemes typically cost, and what happens at renewal, see the August selective licensing guide for landlords.
Frequently asked questions
What is selective licensing?
Selective licensing is a scheme created by a local housing authority under Part 3 of the Housing Act 2004 that requires every landlord letting a privately rented residential property within a designated area to hold a valid licence for that property. It applies to all categories of private rented property, including single lets, not just HMOs. Over 60 schemes are currently active in England, with new ones being introduced following the removal of the Secretary of State approval requirement in December 2024.
How is selective licensing different from HMO licensing?
Mandatory HMO licensing applies nationally to any HMO with five or more occupants from two or more households, there is no local authority discretion involved. Selective licensing applies to all private rented properties in a designated area, including single lets, but only within areas where the local authority has designated a scheme. A property already licensed as an HMO is exempt from selective licensing.
Do I need one licence per property or one per landlord?
One per property. A landlord with multiple properties in a selective licensing zone must hold a separate licence for each one. The licence is tied to the property, not the landlord.
What happens if I let without a selective licence?
Letting without a required licence is a criminal offence under the Housing Act 2004. The local housing authority can impose a civil penalty of up to £30,000, or prosecute for an unlimited fine. The landlord also cannot serve valid Section 8 notices on most grounds during the unlicensed period, and the tenant may apply for a Rent Repayment Order of up to 24 months' rent.
How do I check if my property needs a selective licence?
Use the August selective licensing checker, enter a postcode to see whether a scheme is active in that local authority area and access the relevant council's licensing portal.
