Dramatic rise in licence application fees as Lambeth’s additional licensing scheme comes into force

Friday, December 17th, 2021 - Lambeth Council

Lambeth Council additional licensing fees

A borough wide additional licensing scheme covering all Houses in Multiple Occupation (HMOs) came into force in Lambeth on 9 December 2021.

The licensing scheme includes house and flat shares, bedsits, and some buildings converted into flats that are occupied by three or more people forming more than one household. The scheme is expected to cover an estimated 5,000 properties.

More information about the background to the scheme can be found here.

According to Lambeth Council, they began accepting licence applications on 9 December 2021 when the scheme came into force. However, to ensure compliance, all applications should have been submitted by that date. London Property Licensing is urging landlords and agents to get applications submitted as a matter of urgency to avoid enforcement action.

Dramatic rise in licence application fees

To coincide with the new licensing scheme, licence application fees in Lambeth have risen by a staggering 75%.

Until 8 December 2021, the council charged a licence application fee of £289 per bedroom. This equated to £867 for a three-bedroom HMO, £1,156 for a four-bedroom HMO and £1,445 for a five-bedroom HMO.

The new fee structure is substantially more expensive. From 9 December 2021, the council are charging £506 per bedroom. This equates to £1,518 for a three-bedroom HMO, £2,024 for a four-bedroom HMO and £2,503 for a five-bedroom HMO.

Lambeth now charges the highest per-bedroom HMO licensing fee in London.

Based on research by London Property Licensing, they also charge the highest additional HMO licensing fee in London for a four-bedroom property, and way above the London average of £1,175.

The council is offering a 20% discount to accredited landlords and for membership of some professional bodies.

Richard Tacagni, MD, London Property Licensing commented:

The steep upward trend in property licensing fees is a huge concern for the lettings industry. My own research shows a 40% rise in HMO licensing fees over five years. This rate of increase is not sustainable and will discourage landlords from offering shared accommodation and worsen the housing shortage.

Unless local government can slow the rate of growth in licensing fees, the Secretary of State may need to intervene to avoid blight on the private rented sector. Regulations could be made under section 63 of the Housing Act 2004, or changes to the 2015 General Approval, to set a fair and reasonable licence fee framework.

A free guide containing more detailed information about property licensing and HMO planning rules in the London Borough of Lambeth is available here.

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