Local authorities - are they stepping up enforcement?

About local licensing

This blog post looks at recent polling the NRLA has undertaken with landlords on the topic of selective licensing. Selective licensing is distinct from mandatory licensing which applies to all HMO properties.

It was a previous Labour government which introduced selective licensing in 2006: The policy provided Local Authorities with greater powers to address perceived problems in the private rented sector. 

There are six reasons why a local authority may select a specific location as a selective licensing area. These do not just include poor housing, but also areas of low demand, high levels of migration as well as neighbourhoods typified by deprivation or high crime. 

Part 3 of the Housing Act 2004 gives local authorities power to introduce a licensing scheme covering almost all PRS properties within a defined area. A local authority may designate either the whole area of their district or an area in their neighbourhood.

Local housing authorities in England can now introduce or extend selective schemes as they wish, without the need for any confirmation from the Secretary of State before implementation. A scheme however still requires consultation. The NRLA reviews those schemes of which it becomes aware, although the consultation cannot stop a local authority determined to implement a selective licensing scheme.

The NRLA strives to ensure local authorities follow the correct process in a scheme’s introduction. This is not always the case!

The NRLA conducted its “All Landlord Survey” through on-line interviews with 1,000 landlords: market research company, Dynata undertook the fieldwork, with a sample drawn from their own audience database. 

(Note that questions on selective licensing formed part of a larger survey encompassing multiple topics). 

• Exactly 50% of the sample were current NRLA members.
• A further 11% stated they “used to be” members of the NRLA but were no longer so at the time of the fieldwork. 

Dynata conducted the fieldwork in January and February 2026.

What landlords told us about selective licensing

When asked by the NRLA, 32% of landlords stated they currently let property in a selective licensing area. 

• In addition, a further 23% of landlords stated that, whilst not currently letting property in a licensing area, they “expect to be soon” given the expansion of local licensing.

The NRLA asked both these groups further questions about their experiences of licensing – both selective and mandatory.

Licence applications

More than three-quarters (77%) of landlords who had at least one licence stated they had applied for a licence during the previous five years.

• This means just over 40% (41%) of all landlords polled had applied for at least one licence during the last five-year period.

The graph below sets out how long it took these landlords to complete their most recent application process:

This chart is more positive than more anecdotal evidence may suggest: most landlords are reporting local authorities were processing applications within 12 weeks of submission. 
This headline figure does however hide wide disparities:

• In the Midlands regions (East and West) for example, 42% of landlords reported local authorities were slower to approve licence applications with the process taking between twelve weeks and one year. 
• This experience contrasts with applicants from London and Northern England (North East, North West, and Yorkshire & The Humber combined). Here just 28% of landlords reported applications took this length of time.

Some regions are much more efficient in processing applications and drive the overall wait-times down:

In London  - 67% of landlords reported applications taking less than twelve weeks, whilst the Northern regions reported an even higher figure - 70% of landlords reported processing times of less than twelve weeks.

Licensing inspections

The purpose of local licensing schemes is to improve housing standards in highly localised areas. Licensing allows councils to set mandatory conditions for the tenancy. This ensures that homes are safe, meet basic health and safety requirements, and provided by landlords who meet "fit and proper" standards. The license fee is supposed to fund an inspection process. 

The NRLA has frequently pointed out inspections and enforcement have been somewhat of a postcode lottery. NRLA members have been frustrated that licensing is little more than “added red tape” with few visible links to successful enforcement of rules.

However, evidence from this survey may indicate landlords are becoming more likely to receive an inspection.

The chart below shows the main outcomes of those inspections with the mitigations landlords had to put in place:

(Note this is not a complete list, but the most common mitigations – the editing was was simply for space-related reasons)

This chart shows that following inspection, local authorities are likely to ask landlords to take some form of mitigation: Only 16% of landlords reported "No action" was necessary following an inspection.

It is notable that for one-in-four landlords, the mitigation measures following inspection included ensuring the landlord possessed a valid licence. 

Impact of licensing costs

Finally, the NRLA asked those landlords who hold a selective licence whether the cost of that licence had had an impact on their business strategy:

• More than 40% (44%) of this group of landlords stated they had increased rents - at least in part because of the “additional costs of licensing”.
  • Note there was a wide regional variation – 49% of landlords who let property in London acknowedged this link, compared to just 39% in the midlands 
• A further 13% of landlords stated they had sold property which they had previously let (so potentially reducing supply) because of the property’s location in a selective licensing area.

In addition:

• There was also a group of landlords - 10% - who stated they had done both (ie raise rents and sell properties) of these actions. 

So, of those landlords who have a selective license,  two-thirds cited the licence cost as a factor in rent-increase and portfolio-reduction decisions. 

There is more: Another group of landlords exist - 18% of landlords of the total and not included in any of the above groups:

• This group stated that, though they had not acted so far, they were planning to either raise rents and/or sell affected property.

Note that NRLA members appear to be more resilient on this measure: 

• Whilst 24% of non-members were considering selling because of the additional costs of licensing, among NRLA members, this figure falls to 15%.

Summary

Almost one-landlord-in-three who responded to the survey stated they were operating in an area covered by a selective licensing scheme. Many more landlords anticipate joining this group soon. 

At first glance a reader may see signs of the licence application process working more effectively than previous NRLA research has indicated.

• However, the overall results in this study mask regional variations and, no doubt (based on previous research) each region will also have its own wide variation of results. 

The NRLA extensively use Freedom of Information requests to drill into the length of time a selective licence application takes.

• In the next round of research, the NRLA will be able to test whether new or extended schemes have longer process times than those which have simply renewed. 

A high proportion of landlords who let in selective licensing areas have received at least one property inspection in the last five years. Most landlords who have had a local authority inspection reported the need to take some action.

• For many these actions included obtaining or renewing their license. 

These results will also prompt further research into the extent and cost of the mitigation required (this research was part of a multi-topic survey and so introductory in nature). 

What this means for the sector

These results show that for many landlords selective licensing costs were - at the very least – an important factor in them having to take decisions detrimental to tenants – be that reducing portfolios or increasing rents: There is no ‘standard capped’ selective licence fee.

The absence of a cap means, although legislation does not permit a local authority to make a profit from selected licensing, a landlord with multiple properties in multiple local authority areas can pay varying amounts for a licence. 

Local authorities typically focus efforts on ensuring landlords have licenses. But with these costs going up, and schemes expanding, the need for local authorities to demonstrate a link between licensing and higher standards is now even more acute.