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Home · Property Management · Rent Magazine : What Landlords Need to Know About Business Licenses

By: Jennifer Friedman

Rules and regulations surrounding landlords have been a hot topic in the news recently, especially with the recent rulings regarding Airbnb in New York City. Understanding the local rules and regulations, as well as licensing requirements, are essential to running a strong rental business.

When it comes to business licensing, landlords are often required to register their properties and obtain specific licenses for their rentals, just as with any business owner. Attaining the mandatory licenses will protect your property, tenants and personal assets. Failure to file can lead to costly fines and put you in a risky situation. The following are the basics every landlord should keep in mind.


There are two common property management licenses that landlords will need before they can legally rent a property:

Certificate of Occupancy – Local building or zoning regulatory authorities issue Certificates of Occupancy stating that a property is built and maintained to accommodate occupants. This certificate goes hand in hand with a building permit, which a landlord must file with the local authorities. A Certificate of Occupancy mainly protects tenants and prospective renters, as a local government inspector must ensure the unit complies with building and zoning codes.

Housing business license – A housing business license is usually obtained after the Certificate of Occupancy and is usually required for each rental unit. The housing business license depends on what type of property is being rented. If you own a single-family home, the form is often different than the one you would fill if you owned a duplex or condominium.

Beyond these, some cities have very stringent guidelines whereas other areas have few formal rules for landlords. The number and types of required licenses will differ depending on several elements including where your property is located. Check with your local departments of housing and business to determine your specific needs.


It is unwise to rent out a property without the required licenses and approvals. There are many consequences that come with renting out property illegally. The government may order you to cease your rental business completely and fine you heavily for not having the proper licensing. If you do not disclose to your insurance provider that you are renting a property, your insurance coverage may not include the unit or occupants in the event of an accident. Another scenario is being unable to evict a tenant because you have not complied with local laws.

Once you have filed the proper documents with the appropriate agencies, you aren’t completely out of the woods in regards to licensing. Business licenses expire and requirements change with time. Be sure you are on top of renewal deadlines and fees to stay in compliance with the government.

Being a landlord can provide increased financial freedom if you set yourself up for success at the beginning. Not having the necessary forms and permits puts your assets and the safety of tenants in jeopardy. Investing the time needed to research the licenses that are applicable to your property and registering with the local authorities will put your property business in compliance and minimize risk. You can also work with a business services company who can help with the research or consult your lawyer or accountant.

Jennifer Friedman is the CMO of the small business segment of CT, a Wolters Kluwer Company, which provides legal compliance solutions to small businesses. In this role, Jennifer directs all activities related to digital marketing and advertising to help build the brand through innovation, partnerships, and enhancing the customer experience.

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