Selective Licensing London | Additional HMO Licensing 2026

Many London landlords need a property licence to let lawfully, and which one depends on the property and the borough. There are three types: mandatory HMO licensing applies nationwide to large HMOs of five or more occupiers; additional HMO licensing extends licensing to smaller HMOs in boroughs that choose to introduce it; and selective licensing covers ordinary, non-HMO rented homes in designated areas. Additional and selective schemes are local, time-limited and vary borough to borough, with fees typically £500–£1,500 per property for five years. Letting without a required licence risks civil penalties of up to £30,000 and rent repayment orders.

The three types of property licensing

Property licensing in England comes in three distinct forms, and the first task for any London landlord is to work out which, if any, apply to their property, because the rules differ sharply between them. Mandatory HMO licensing is national and fixed: any HMO occupied by five or more people forming two or more separate households must be licensed, wherever it is in England. This is not a borough choice, it applies everywhere. Additional HMO licensing is a local extension: a council can designate an area, or its whole district, where smaller HMOs (those falling below the mandatory five-occupier threshold) also require a licence. Selective licensing is different again, it applies not to HMOs but to ordinary, single-household private rented homes, in areas a council designates to tackle problems such as low housing demand, anti-social behaviour or poor property conditions. The consequence is that a single property could need no licence, an HMO licence, or a selective licence depending on what it is and where it sits. A family let in one borough may need a selective licence while an identical property in the next borough needs nothing; a three-person house-share may need an additional HMO licence in one area and none in another. There is no substitute for checking the specific borough's current designations. Landlords can find more guidance on our /for-landlords page.

Licence type	What it covers	Who sets it
Mandatory HMO	HMOs with 5+ occupiers in 2+ households	National — applies everywhere
Additional HMO	Smaller HMOs below the mandatory threshold	Local — borough designates the area
Selective	Ordinary non-HMO private rented homes	Local — borough designates the area

Mandatory HMO licensing: the national baseline

Mandatory HMO licensing is the one type that applies everywhere without a borough having to opt in, so it is the baseline every landlord of a larger shared house must know. A property is a licensable HMO under the mandatory scheme if it is occupied by five or more people who form two or more separate households and who share amenities such as a kitchen, bathroom or toilet. This captures the typical larger house-share. The licence is held by the landlord or managing agent, lasts up to five years, and comes with conditions covering the safe management of the property. Applying for and holding the licence is a legal requirement, not a formality, letting a mandatory-licensable HMO without a licence is a serious offence. The mandatory scheme also brings minimum standards that the property must meet, including minimum room sizes for sleeping accommodation, adequate kitchen and bathroom facilities for the number of occupiers, and fire safety provisions. A property that does not meet these standards cannot simply be licensed as-is, the landlord must carry out the works to bring it up to standard. This is where licensing and refurbishment meet: passing the licence often requires physical works, from fire doors and alarms to additional or reconfigured facilities, which we cover through our HMO compliance and fire safety work.

Additional and selective licensing: local and time-limited

The two local licensing types, additional and selective, are where landlords are most often caught out, because they vary by borough and change over time, so what was true last year or in the next borough may not be true for your property now. Additional HMO licensing lets a council require licences for HMOs that fall below the mandatory five-occupier threshold, smaller shared houses that would otherwise need no licence. Selective licensing lets a council require a licence for ordinary, non-HMO private rented homes in a designated area. Both are introduced by the individual council for a defined area, which may be the whole borough or specific wards, and both are time-limited, a designation typically runs for five years, after which it lapses unless the council renews it. This means a scheme can begin, end, or change boundaries, and a property can move in or out of scope as designations come and go. The practical implication is that licensing status must be checked for the specific property, in the specific borough, at the time you are letting, not assumed from a general rule or a neighbour's experience. Every London council publishes its current additional and selective licensing designations, including the areas covered and the dates they run. Because larger or renewed schemes are introduced regularly across London, a landlord with properties in several boroughs may face different requirements for each, and a property that needed no licence at the last tenancy may need one now. Checking at each letting, and before buying a property to let, is the only reliable approach.

Licensing fees: what you pay and for how long

Licensing is not free, and while the fee is rarely the deciding factor, landlords budgeting a rental need a realistic figure, which varies by borough and licence type. Fees are set by each council and differ significantly, but a typical range is around £500 to £1,500 per property for a licence lasting up to five years, with HMO licences generally at the higher end and selective licences often lower. Some boroughs charge per HMO room or per unit, which raises the figure for larger properties, and many split the fee into an application part and a grant part. Discounts are sometimes available for accredited landlords or for early application within a new scheme's window. Because the fee covers up to five years, the annual cost is modest, but it is a real cost that belongs in the letting budget. More important than the fee itself is what comes with it. A licence application triggers the council's scrutiny of the property against the relevant standards, and the works needed to meet those standards usually dwarf the licence fee. A landlord focused only on the application cost, and not on the condition the property must be in to pass, is budgeting for the wrong thing. The fee buys the licence; the works buy the compliance that lets the property qualify for it.

What works are needed to pass a licence inspection?

The heart of licensing, for a refurbishment business, is the physical standard the property must meet, because passing a licence is rarely just paperwork, it is bringing the property up to the required condition. For HMO licences in particular, the property must meet standards covering fire safety, amenities and space. Fire safety is the largest area: interlinked smoke and heat alarms, fire doors to bedrooms and risk rooms (often with self-closers), protected escape routes, and emergency lighting where required. Amenity standards require adequate kitchen and bathroom facilities for the number of occupiers, so a house may need an additional bathroom or a reconfigured kitchen to license at a given occupancy. Space standards set minimum room sizes for sleeping accommodation, a room below the minimum cannot be counted as a bedroom for the licence. Selective licences on ordinary lets focus more on general condition, repair, and basic safety, but still require the property to be in a proper state. This is precisely the work we carry out to get properties through licensing, fire doors and alarm systems, emergency lighting, partition and layout changes to create compliant rooms and facilities, and the general repair and refurbishment that brings a property up to the required standard. The sensible sequence is to establish what the licence demands, carry out the works, then apply, so the inspection finds a property that already complies rather than a list of failures. Doing the works first is also far less disruptive than being served conditions after licensing and having to do them around a sitting tenant.

Penalties for letting without a required licence

The reason licensing cannot be treated as optional is the scale of the penalties, letting a property that should be licensed without a licence is one of the most heavily penalised breaches in the private rented sector. Operating a licensable property without a licence is a criminal offence. A council can prosecute, leading to an unlimited fine, or it can impose a civil penalty of up to £30,000 per offence as an alternative to prosecution. On top of that, an unlicensed landlord is exposed to a rent repayment order, under which a tenant, or the council where housing benefit or universal credit was paid, can reclaim up to twelve months of rent. A landlord can therefore face both a £30,000 civil penalty and a year's rent repaid for the same unlicensed letting. There is a further consequence: a landlord cannot serve a valid section 21 notice to regain possession while the property should be licensed but is not, frustrating the ability to end a tenancy. Stacked together, these penalties make unlicensed letting a financial risk far out of proportion to the licence fee and the cost of compliance works. The protective course is straightforward: establish what licence the property needs in its borough, carry out the works to meet the standard, obtain the licence, and keep it current as schemes are renewed or changed. We help landlords get properties licence-ready, handling the fire safety, facilities and refurbishment works that turn a property the council would fail into one it will license.

Frequently Asked Questions

What is the difference between selective and additional licensing?

Additional licensing applies to HMOs that fall below the mandatory five-occupier threshold, smaller shared houses, in areas a council designates. Selective licensing applies to ordinary, single-household private rented homes (not HMOs) in designated areas, used to tackle issues such as poor conditions or anti-social behaviour. Both are introduced locally by the borough, cover defined areas, and are time-limited, typically running for five years.

Do I need a licence to rent out a property in London?

Possibly, depending on the property and the borough. Any HMO with five or more occupiers in two or more households needs a mandatory HMO licence everywhere. Smaller HMOs may need an additional licence, and ordinary non-HMO rentals may need a selective licence, where the borough has designated a scheme. Because additional and selective schemes vary by borough and change over time, you must check the current designations for your specific property and area.

How much does a property licence cost in London?

Fees are set by each council and vary, but a typical range is around £500 to £1,500 per property for a licence lasting up to five years, with HMO licences generally higher and selective licences often lower. Some boroughs charge per room or per unit. More significant than the fee is the cost of the works needed to bring the property up to the standard required to pass, which usually exceeds the licence fee itself.

What work is needed to pass an HMO licence inspection?

HMO licensing requires the property to meet fire safety, amenity and space standards. That typically means interlinked smoke and heat alarms, fire doors with self-closers, protected escape routes and emergency lighting; adequate kitchen and bathroom facilities for the number of occupiers; and bedrooms meeting minimum room sizes. The usual approach is to establish what the licence demands, carry out the works, then apply, so the inspection finds a property that already complies.

What is the penalty for letting a property without a required licence?

Letting a licensable property without a licence is a criminal offence. A council can prosecute for an unlimited fine, or impose a civil penalty of up to £30,000 per offence instead. The landlord is also exposed to a rent repayment order of up to twelve months' rent, and cannot serve a valid section 21 notice while the property should be licensed but is not. These penalties far exceed the licence fee and the cost of compliance works.

Selective and Additional Licensing for London Landlords (2026)