Rachel Reeves has broken housing regulations by unlawfully renting out her family home without a licence after entering Downing Street, the Daily Mail can reveal.
The Chancellor tonight referred herself to the independent ethics adviser and had to admit her error to the Prime Minister after inquiries by this newspaper.
Ms Reeves failed to obtain a rental licence when she placed her family home in Dulwich on the rental market last year as she moved with her family into Number 11 Downing Street.
The Chancellor put her four-bedroom detached house on the market for £3,200 a month last year, and her register of interests states she has received rental income since September 2024.
Southwark Council, the local authority, requires that private landlords in certain areas – including where her house is located – obtain a ‘selective’ licence to rent out their property.
But tonight she admitted that she was unaware of the licencing requirement and, following inquiries by the Mail, applied for the licence.
A spokeswoman for Ms Reeves said: ‘Since becoming Chancellor Rachel Reeves has rented out her family home through a lettings agency.
Ms Reeves failed to obtain a rental licence when she placed her family home in Dulwich (pictured) on the rental market last year as she moved with her family into Number 11 Downing Street
The Chancellor put her four bedroom detached house on the market for £3,200 a month last year, and her register of interests states she has received rental income since September 2024
‘She had not been made aware of the licencing requirement, but as soon as it was brought to her attention she took immediate action and has applied for the licence.
‘This was an inadvertent mistake and in the spirit of transparency she has made the Prime Minister, the Independent Adviser on Ministerial Standards and the Parliamentary Commissioner for Standards aware.’
Tory leader Kemi Badenoch said they were ‘very serious revelations’.
‘If the Chancellor, who has spent months floating punishing tax hikes on family homes, has at the same time seemingly been profiting from illegally renting out her house, that would make her position extremely tenuous.
‘The Prime Minister must launch a full investigation. He once said “lawmakers can’t be lawbreakers”. If, as it appears, the Chancellor has broken the law, then he will have to show he has the backbone to act.’
It is understood that Ms Reeves used an external lettings agency to rent out the house, and she did not receive any advice that a rental licence was required.
Ms Reeves took immediate action following the Mail’s inquiries, and an application for the licence was submitted today.
The Chancellor also informed the Prime Minister, the Independent Adviser on Ministerial Standards and the Parliamentary Commissioner for Standards.
Tory leader Kemi Badenoch said they were ‘very serious revelations’. She added a full investigation must be launched
Southwark Council, like many other local authorities, requires that private landlords in certain areas obtain a ‘selective’ licence to rent out their property.
This has applied to most private residential properties rented to single families or unrelated tenants in the borough, since November 2023.
There are few exemptions for requiring this type of licence, including if the property already has an HMO licence, is used as a holiday let or for religious purposes, or if the owner also resides in the property as their main home.
It is not thought any of these apply to Ms Reeves.
Southwark Council said the licences were brought in to ‘improve safety, security and quality for people living in private rented homes’.
They cost £900 and landlords must submit documents proving their property is fit for purpose, including gas, electrical and fire safety certificates, floor plans and tenancy agreements.
Failing to obtain a licence when required is a criminal offence and can be punishable with an unlimited fine on prosecution, a fine of £30,000 as an alternative to prosecution, or the landlord could be ordered to pay back up to 12 months’ rent.
Property experts say the added red tape, alongside other requirements to be brought in under the Renters’ Rights Bill, is forcing some smaller landlords out of the rental sector altogether, squeezing supply and hiking rents yet further.
The inside of the property is pictured. Failing to obtain a licence when required is a criminal offence
Southwark Council policy states that it seeks an ‘informal approach’ if the landlord cooperates and submits a valid application along with the appropriate fee ‘within a reasonable time scale’
Local estate agents said many landlords were not aware that they needed a licence, particularly if they had been renting out properties before this became a requirement and had simply carried on as normal.
But some raised questions over how Ms Reeves could not have known given it appears she began renting out her property after the changes were brought in.
Southwark Council policy states that it seeks an ‘informal approach’ if the landlord cooperates and submits a valid application along with the appropriate fee ‘within a reasonable time scale’.
It adds that it ‘employs resources to find unlicensed properties and where identified may apply an enhanced application fee to cover the additional costs incurred in having to find the unlicensed property’.
Landlords have already lashed out at the Chancellor after she raised stamp duty on buy-to-let homes from 3 per cent to 5 per cent in her first Budget, with some saying it was ‘the final nail in the coffin’ for the struggling sector.
