Selective Licensing Explained: Areas, Fees and How to Check

Selective licensing is one of the most significant regulatory developments in the UK private rented sector since the Housing Act 2004. It gives local councils the power to require every private landlord in a designated area to hold a licence before renting out their property, regardless of property type or number of occupants. As of March 2026, 84 selective licensing schemes are active across England and Wales, covering hundreds of thousands of rental properties.

This guide explains what selective licensing is, why councils introduce it, how much it costs, what happens if you do not comply, and how to check whether your property falls within a designated area.

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What is Selective Licensing?

Selective licensing is a discretionary power granted to local housing authorities under Part 3 of the Housing Act 2004. Unlike mandatory HMO licensing, which applies nationally to all larger houses in multiple occupation, selective licensing is a local decision. A council may designate any area within its boundaries for selective licensing if it can demonstrate that the area meets one or more statutory conditions.

The statutory conditions for a selective licensing designation are set out in section 80 of the Housing Act 2004. A council may designate an area if it is satisfied that the area:

• is, or is likely to become, an area of low housing demand;
• is experiencing a significant and persistent problem caused by anti-social behaviour;
• has a high proportion of properties in poor condition;
• has experienced a high level of migration;
• has a high level of deprivation; or
• has a high level of crime.

A council does not need to satisfy all of these conditions. A single condition is sufficient, provided the council can demonstrate that licensing will help address the problem.

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Which Councils Operate Selective Licensing Schemes?

Selective licensing schemes are concentrated in urban areas with large private rented sectors. Some of the most significant schemes as of March 2026 include:

London: Newham has operated a borough-wide selective licensing scheme since 2013, making it one of the longest-running schemes in England. Hackney and Waltham Forest also operate schemes covering significant portions of their housing stock. See the London property licensing guide for a full overview of all active schemes across the capital.

Northern England: Salford has operated a borough-wide selective licensing scheme since 2016. Nottingham and Manchester operate schemes covering specific wards or areas.

Midlands and Wales: Birmingham operates selective licensing in several wards. Cardiff and Swansea operate schemes under Welsh housing legislation.

Use the Tuxa property licence checker to see whether your specific property falls within any active scheme. The checker covers all 361 UK councils and is updated as new schemes are confirmed.

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How are Selective Licensing Schemes Designated?

The designation process depends on the scale of the proposed scheme. Under section 82 of the Housing Act 2004, a council must consult with persons likely to be affected by a designation before confirming it. This consultation must be genuine and must give affected parties a reasonable opportunity to make representations.

If a proposed scheme would cover more than 20% of the council's geographical area, or more than 20% of privately rented dwellings in the council's area, the council must obtain confirmation from the Secretary of State before the designation can take effect. This requirement was introduced by the Housing and Planning Act 2016 to prevent councils from using selective licensing as a revenue-raising tool rather than a targeted housing intervention.

Schemes that fall below the 20% threshold can be confirmed by the council itself without central government approval. This has led to a proliferation of smaller, ward-level schemes in recent years.

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How Much Does a Selective Licence Cost?

Licence fees are set by individual councils and vary significantly. As of March 2026, fees typically range from £400 to £900 per property for a five-year licence term. Some councils charge a flat fee; others use a tiered structure based on the number of bedrooms or occupants.

The licence is property-specific, not landlord-specific. A landlord with five properties in a designated area needs five separate licences, each attracting the full fee.

Councils are permitted to charge a fee that reflects the reasonable costs of administering the scheme. They cannot use licence fees as a general revenue source. The MHCLG guidance on selective licensing fees sets out the principles that councils must follow when setting fees.

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What Conditions Does a Selective Licence Impose?

A selective licence sets out the conditions under which the property may be let. Standard conditions, prescribed under section 90 of the Housing Act 2004, include:

• the property must be maintained in a safe and habitable condition;
• gas safety certificates must be obtained annually;
• electrical installation condition reports must be obtained every five years;
• smoke alarms must be installed on every floor;
• carbon monoxide alarms must be installed in rooms with solid fuel appliances;
• the landlord must provide tenants with a copy of the licence;
• the landlord must take reasonable steps to prevent anti-social behaviour by occupants.

Councils may also impose additional conditions tailored to local circumstances. Failure to comply with licence conditions is a criminal offence under section 95 of the Housing Act 2004.

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What Happens if You Rent Without a Selective Licence?

Renting a property without the required selective licence is a criminal offence under section 95 of the Housing Act 2004. The consequences are severe:

Criminal prosecution: A landlord convicted of renting an unlicensed property faces an unlimited fine in the magistrates' court.

Civil financial penalty: Under the Housing and Planning Act 2016, councils can issue a civil penalty of up to £30,000 per unlicensed property without going to court. The Renters' Rights Act 2025 increases this ceiling to £40,000.

Rent repayment order: Tenants can apply to the First-tier Tribunal (Property Chamber) for a rent repayment order requiring the landlord to repay up to 12 months of rent. Local authorities can also apply for rent repayment orders on behalf of tenants.

No-fault eviction: An unlicensed landlord cannot serve a valid possession notice. Under the Renters' Rights Act 2025, Section 21 is abolished entirely, but the principle that licensing non-compliance blocks possession proceedings is preserved.

See our full guide to penalties for renting without a licence for more detail.

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How to Check Whether Your Property Needs a Selective Licence

The quickest way to check is to use the Tuxa property licence checker. Enter any UK address or postcode and Tuxa will check against all active selective licensing schemes across all 361 UK councils. Results are instant and free to view.

You can also check directly with your local council. Most councils that operate selective licensing schemes publish the designated area boundaries on their websites, along with guidance on how to apply for a licence.

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Related Guides

• Selective vs Additional Licensing: Key Differences
• Penalties for Renting Without a Licence
• What is Additional Licensing for HMOs?
• Mandatory HMO Licensing: The National Standard
• How to Apply for a Selective Licence

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Sources

1. Housing Act 2004, Part 3 - Selective Licensing (legislation.gov.uk)
2. Housing Act 2004, section 80 - Designation of selective licensing areas (legislation.gov.uk)
3. Housing Act 2004, section 82 - Consultation requirements (legislation.gov.uk)
4. MHCLG: Selective Licensing in the Private Rented Sector - Guide for Local Authorities (GOV.UK)
5. Housing and Planning Act 2016 (legislation.gov.uk)
6. Renters' Rights Act 2025 (legislation.gov.uk)

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Last reviewed March 2026 by Ben Yarrow, founder of Tuxa. Data sourced from council designation orders and MHCLG scheme notifications.