Rachel Reeves has broken housing law by unlawfully renting out her family home without a licence after entering Downing Street: Chancellor faces ethics probe

The Daily Mail has revealed that Rachel Reeves breached housing regulations by illegally renting her family’s home without a licence, after entering Downing Street.

The Chancellor tonight referred himself to the independent ethics adviser and was forced to admit his mistake to the Prime Minister after this newspaper’s investigation.

Ms Reeves was unable to obtain a letting license when she put the family home in Dulwich on the rental market last year because she had moved into Number 11 Downing Street with her family.

The Chancellor put his four-bedroom detached house up for sale for £3,200 a month last year, and interest records indicate it has been generating rental income since September 2024.

Local authority Southwark Council requires private landlords in certain areas, including where his home is located, to obtain a ‘selective’ license to rent their properties.

But tonight he admitted he was unaware of the license requirement and applied for a license following questions from the Mail.

A spokesman for Mrs Reeves said: ‘Rachel Reeves has rented her family home through a lettings agency since becoming Chancellor.

The Chancellor put his four-bedroom detached house up for sale for £3,200 a month last year, and interest records show it has been generating rental income since September 2024

‘He was not notified of the licensing requirement, but as soon as he was notified he immediately took action and applied for a licence.

‘This was an inadvertent mistake and in the spirit of transparency the Prime Minister, the Independent Adviser on Ministerial Standards and the Parliamentary Standards Commissioner were informed.’

Conservative Party leader Kemi Badenoch said these were ‘very serious statements’.

‘If the Chancellor, who has spent months pushing for punishing tax rises on family homes, also appears to be profiting by illegally renting out his home, this will make his position extremely weak.

‘The Prime Minister should launch a comprehensive investigation. “MPs cannot break the law,” he once said. If, as it appears, the Chancellor has broken the law, then he will have to show that he has the courage to act.’

It is understood Ms Reeves used an external letting agency to rent the house and did not receive any advice that a letting license was required.

Ms Reeves took immediate action following the Mail’s inquiries and the license application was submitted today.

The Chancellor also briefed the Prime Minister, the Independent Adviser on Ministerial Standards and the Parliamentary Commissioner for Standards.

Conservative Party leader Kemi Badenoch said these were ‘very serious statements’. He added that a comprehensive investigation should be launched

Southwark Council, like many other local authorities, requires private landlords in certain areas to obtain a ‘selective’ license to rent their properties.

This applies to most private housing let to single families or unrelated tenants in the borough since November 2023.

There are a few exceptions to requiring such a license, including if the property already holds an HMO licence, is used as a holiday let or for religious purposes, or if the owner also resides at the property as their main home.

None of this is thought to apply to Ms. Reeves.

Southwark Council said the licenses were introduced to ‘improve safety, security and quality for people living in private rented homes’.

It costs £900 and landlords must provide documentation proving their property is fit for purpose, including gas, electrical and fire safety certificates, floor plans and tenancy agreements.

Failure to obtain a license when required is a criminal offense and is punishable by an unlimited fine as an alternative to prosecution, a fine of £30,000 as an alternative to prosecution, or the landlord can be ordered to repay up to 12 months’ rent.

Real estate experts say the added red tape, along with other requirements to be introduced under the Tenants’ Rights Act, is forcing some small landlords to exit the rental industry altogether, squeezing supply and driving up rents even further.

The interior of the property can be seen in the picture. Failure to obtain a license when necessary is a crime

Southwark Council policy states that it is looking for an ‘informal approach’ if the landlord cooperates and submits a valid application with the appropriate fee ‘within a reasonable timescale’.

Local estate agents said many landlords were unaware they needed a licence, especially if they had been renting out their properties before it became a requirement and were carrying on as normal.

But some have raised questions as to how Ms Reeves could not have known this, given she was understood to have started renting her property after the changes were made.

Southwark Council policy states that it is looking for an ‘informal approach’ if the landlord cooperates and submits a valid application with the appropriate fee ‘within a reasonable timescale’.

It adds that it ‘uses resources to locate unlicensed properties and, if identified, may impose an increased application fee to cover the additional costs incurred in locating the unlicensed property.’

Landlords have hit out at the Chancellor, who increased stamp duty on rented homes from 3 per cent to 5 per cent in his first budget; some said it was the ‘final nail in the coffin’ for the struggling industry.