Landlords offering homes for multiple occupation will have been aware for some time that the 2004 Housing Act (HA) introduces a licensing requirement for landlords which is effective from April 2006. However, the scale of charges for the five-year compulsory licences has come as a shock to many, especially those in the ‘buy to let’ market, with some councils demanding over £1,000 for a licence.

Under the HA, a landlord who lets an entire home to three or more tenants who form two or more households and who share a kitchen, bathroom or toilet is required to register for a licence with the local council. The rules also apply to converted buildings containing self-contained flats if more than a third of the flats are let on short-term tenancies and the conversion did not meet the standards of the 1991 Building Regulations. However, councils have the ability to alter these requirements to insist that all landlords obtain a licence. There is a three-month period of grace for registration, but failure to register by 6 July 2006 is a criminal offence punishable by a fine of up to £20,000.

Under the new rules, licences will only be granted to ‘fit and proper’ people. A separate licence is needed for each property, which must comply with fire safety regulations and meet specified standards of accommodation.

Further information can be found at www.propertylicence.gov.uk.

If you rent out a property which is caught by the new law and have not yet applied for a licence, time is running out. If you would like further advice on this or any other property-related matter, please contact Stephen Frith.