News

Thousands of private rented homes in Tower Hamlets are being rented out without the correct licence

Tuesday, February 28, 2017

Research by London Property Licensing has found more than half of private rented homes in Tower Hamlet Council’s selective licensing area have not applied for a licence four months after the scheme came into force.

On 1 October 2016, Tower Hamlets Council introduced a selective licensing scheme in three wards in the west of the borough: Weavers, Whitechaple and Spitalfields & Banglatown. The scheme is based on the ward boundaries as they existed pre-22 May 2014.

The licensing scheme applies to all private rented homes within the selective licensing area regardless of whether the properties are houses or flats and are let to an individual, single family or are in multiple occupation. There are very few exemptions.

The licensing scheme lasts for five years and a separate licence application is required for each property. Most licences are issued for five years and the application fee is £520 to £660 per property. Until an application is submitted, the landlord and letting agent are committing an offence if they rent out a property in the selective licensing area.

An estimated 6,000 rented homes need licensing

In response to a freedom of information request, Tower Hamlets Council confirmed there are approximately 6,000 private rented homes that need licensing in their selective licensing area.

By February 2017, 2,100 applications had been received by the council, of which 1,000 licences had already been approved.

Based on the council’s own estimates, there could be around 3,900 private rented homes in the west of the borough where no selective licence application has yet been submitted – accounting for almost two thirds of all private rented homes in the area.

Apply now or risk serious consequences

With twenty-three different property licensing schemes currently operating in London, it can be challenging for landlords and letting agents to keep up to date with all the requirements.

Yet ignorance of the law is no defence and so London Property Licensing is encouraging all landlords to check whether any of their properties need to be licensed.

Some landlords are still under the misapprehension that licensing only applies to larger Houses in Multiple Occupation (HMOs) whereas in many areas, property licensing is now far more extensive.

Fail to apply for the correct licence and the consequences can be severe:

  • The landlord and their letting agent can face criminal prosecution and an unlimited fine;
  • Landlords can be ordered to repay up to 12 months rental income either to the council or their tenants; and
  • Landlords lose the ability to evict their tenants using a section 21 notice of seeking possession.

Further sanctions are expected soon, including new civil penalty notices of up to £30,000 and banning orders for the worst offenders.

Richard Tacagni, Managing Director, London Property Licensing said:

The myriad of property licensing schemes operating across London is becoming a major headache for landlords and letting agents as they struggle to understand what rules apply where.

Fortunately, the London Property Licensing website has been developed as a free information resource mapping out the rules and regulations across every London Borough. A quick and user-friendly process, backed by expert advice and assistance for those that need more in-depth support”.

To find out more about property licensing in Tower Hamlets, visit www.londonpropertylicensing.co.uk/tower-hamlets or contact us to discuss your requirements. 

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