Croydon Council's Cabinet has approved the implementation of a new licensing scheme for private rented homes, aiming to improve housing standards and protect residents across the borough.
The new scheme includes a selective licensing designation across 14 wards and a borough-wide additional licensing scheme for Houses in Multiple Occupation (HMOs).
Councillor Lynne Hale, Cabinet Member for Homes, stated that the schemes are evidence-led and targeted,
with a five-year duration. She emphasised that the schemes will be self-funded through licence fees, designed to create a level playing field for landlords and address issues such as poor housing conditions, ineffective management, and anti-social behaviour.
Selective Licensing Wards and Rationale
The 14 wards included in the selective licensing designation were chosen based on evidence of high levels of poor housing conditions. Specifically, the Private Sector Stock Condition Survey Report identified wards predicted to have higher levels of serious hazards (Category 1 hazards) that exceed national averages. Wards that did not exhibit these high levels of housing hazards, even with a substantial number of private rented properties, were considered for exclusion. The designation area represents 72.5% of PRS properties eligible for selective licensing when HMOs are excluded. The wards included are Addiscombe East, Addiscombe West, Bensham Manor, Broad Green, Fairfield, Norbury & Pollards Hill, Norbury Park, Selhurst, South Croydon, South Norwood, Thornton Heath, Waddon, West Thornton, and Woodside.
Licensing Fees and Application Process
The proposed licence fee for the selective licensing scheme is £800 per property, payable in two parts: £480 upon application (Part A) and £320 upon licence grant (Part B). For the additional HMO licensing scheme, the proposed licence fee is £1,250 per property, also payable in two instalments: £750 upon application (Part A) and £500 upon licence grant (Part B).
Landlords can apply for a licence by submitting the required documentation and paying the initial fee. Part A of the fee covers processing and administration, while Part B covers administration, management, and enforcement. The application process includes a desk-based risk assessment, with higher-risk properties prioritised for inspection. Required documentation includes annual gas safety certificates, electrical installation condition reports (EICRs) at regular intervals (no more than five years), and declarations regarding the safety of electrical appliances and furniture. For HMOs, specific conditions regarding fire safety, including fire risk assessments and alarm maintenance, will also apply. Landlords must also provide details of tenancy management arrangements, including emergency contact numbers and anti-social behaviour (ASB) prevention steps. A written statement of the terms of occupation must be provided to all occupiers, along with copies of the licence, gas safety certificates, EICRs, and fire safety information.
Housing Standards and Enforcement
Under the new licensing schemes, landlords will be required to meet clear conditions on safety and management. These include requirements for gas and electrical compliance, tackling overcrowding, and addressing poor maintenance. Specifically, licence conditions will mandate landlords to meet obligations relating to the letting and proactive management of their properties. For HMOs, mandatory conditions include ensuring adequate heating, space, natural light, ventilation, fire safety provisions, and carbon monoxide alarms. Discretionary conditions will address issues like waste management, personal washing facilities, and preventing overcrowding. For selective licensing, conditions include carrying out property inspections at least every six months, promptly addressing disrepair complaints, and ensuring repairs are carried out by competent persons.
Landlords who fail to comply with the new licensing requirements face several enforcement mechanisms. Operating a licensable property without a licence or allowing occupation exceeding authorised numbers can lead to prosecution, resulting in an unlimited fine. Breaching licence conditions can lead to a fine of up to £5,000 per breach. As an alternative to prosecution, the Council may impose a financial penalty of up to £30,000. Furthermore, applications for Rent Repayment Orders (RROs) can be made to recover up to 12 months' rent, Housing Benefit, or Universal Credit. The Council may also take over the management of an unlicensed property through an Interim Management Order. Offences may also lead to inclusion on the Greater London Authority Rogue Landlord and Agent Register.
Addressing Anti-Social Behaviour
While specific types of anti-social behaviour (ASB) are not detailed as prevalent in the affected areas, the meeting information indicates that poorly managed properties are often linked to ASB. The licensing schemes will make it conditional on landlords to prevent and combat ASB associated with the properties they manage. This includes taking reasonable steps to prevent or reduce ASB by occupiers or visitors, warning tenants about their behaviour, taking formal steps if ASB continues, and informing appropriate authorities if criminal activity is suspected. The scheme aims to reduce ASB incidents through better management of PRS properties, which in turn will improve neighbourhoods and make them safer and more desirable places to live.
Financial Sustainability
The proposed licence fees are set on a cost-recovery basis and are designed to be self-financing, meaning they will cover the costs of administration, inspection, and enforcement of the schemes. A financial model has been created to be cost-neutral over a 10-year period, assuming ongoing licence enforcement and management costs even after new licences cease to be issued. The fees are set in accordance with the Provision of Service Regulations 2009 and Section 87(7) of the Housing Act 2004, which allow local authorities to consider all costs incurred in carrying out their functions. The fees are intended to cover the estimated costs of establishing and administering the schemes and undertaking enforcement actions.
Despite some concerns raised by Councillor Stuart King, Leader of the Opposition, regarding the coverage of the selective scheme, the Cabinet highlighted the data-driven approach and the focus on protecting vulnerable residents.
The decision was made during a Cabinet meeting on Wednesday, 25 March 2026. The new licensing schemes are set to be implemented in the second half of 2026. Further details on the schemes can be found in the Private Sector Property Licensing Scheme document and the Evidence Report.
