Investing in a residential rental property in Philadelphia can be a sound financial choice, however, there’s more to being a landlord than simply handing over the keys and cashing the monthly rent check. If you’re planning on renting out any type of housing unit in the City of Philadelphia, you’ll need to obtain a Housing Rental License from the Department of Licenses and Inspections prior to accepting any tenants, or what is commonly referred to as a Philadelphia Landlord License.
Failure to do so could lead to fines from the city, problems with rent collection, and even an outright ban on your right to sue your rental tenant for unpaid rents and eviction. That’s right – landlords in Philadelphia who fail to obtain the required city licenses have no legal standing in local courts, and judges will only allow landlords to sue delinquent tenants for unpaid rents when there is a valid housing inspection license and certificate of rental suitability on file with the city.
According to the Philadelphia Property Maintenance Code, every property owner who offers a residential property for rent much provide new tenants:
- A Certificate of Rental Suitability (issued by the Department of Licenses and Inspections at no charge to Rental License holders) dated within 60 days of the start of the tenancy
- A copy of the “City of Philadelphia Partners for Good Housing” brochure
The City of Philadelphia maintains a current listing of all properties for which a housing license has been issued on the Licenses and Inspections (L&I) website, where users can search the L & I history of any property by simply entering the address into the site-specific search engine.
Before You Apply for a Landlord License
Before you apply for a Housing Rental License, you’ll need to obtain the following:
- A Commercial Activity License (CAL) (formerly known as a Business Privilege License). Available at no charge; to apply, you must have either a Federal Employer Identification Number or a Social Security Number and a City of Philadelphia Tax Account Number
- Business Tax Account Number, Federal Tax Identification Number or a Social Security Number (for individual property owners)
- Zoning approval (for properties with two or more rental units)
Note that the Commercial Activity License is required for all properties that have four or more residential units which are rented to separate tenants. A recent court ruling determined that individually owned condo units that are rented out must also have a CAL which includes all units in the building; this CAL must be obtained by the respective Condominium Association or management corporation.
Renting Out Units In An Owner-Occupied Property?
If your rental property consists of between 1-3 rental units, and you live full-time on-site (for example, in a duplex), and the only business you’ll be engaging in is the rental of those units, you need to obtain a 2-4 Unit Owner-Occupied Housing Activity License in lieu of a Commercial Activity License, available eClipse.
Preparing Your Application
Once you’ve obtained the required documents, you must complete a License Application, available online. The completed form, along with the $50 annual fee per unit (check or money orders only), can be mailed to:
DEPARTMENT OF LICENSES AND INSPECTIONS CUSTOMER CARE UNIT,
PUBLIC SERVICE CONCOURSE 1401 JOHN F. KENNEDY BOULEVARD PHILADELPHIA,
In A Hurry? Consider Applying in Person
Department of Licenses and Inspections
License Issuance Unit – PCS
1401 John F. Kennedy Boulevard
Philadelphia, PA 19102
When applying in person, remember to bring either a money order or check for the full amount due, along with your completed application and proof of occupancy in the form of:
- A valid Pennsylvania Driver’s License or
- A current utility bill (electric, gas or telephone) that clearly shows the housing license applicant’s name, address and unit number. Note that water utility bills are not accepted as proof of occupancy.
While obtaining a landlord license in Philadelphia can seem like a bit of a hassle, in the long run, this system provides landlords with protection against delinquent tenants and hassles with the city inspectors.