North Yorkshire Council approved the selective licensing designation for parts of the Castle, Northstead and Falsgrave divisions in the seaside town.
Selective licensing allows councils to designate areas where there is a high concentration of privately rented housing, and where there may be issues of poor property conditions and management within those properties, plus associated issues such as high levels of deprivation or anti-social behaviour.
Executive member for culture, arts and housing, Cllr Simon Myers, said: "Selective licensing is one of the ways we can tackle the problems of poor quality and poorly managed accommodation in the private rented sector as well as address anti-social behaviour.
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"The private rented sector within the designated area equates to just over 50 per cent of all the homes there so it is vital we look after the interests of the people who rent them as poor housing can have a big impact on health and social care. We have many good landlords and this scheme aims to help both them and their tenants."
Under the Scarborough scheme, which comes into force on 01 June and lasts five years, all privately rented properties within the designated area will have to be licensed by us.
The period of designation will last for five years and include conditions aimed at ensuring licensed properties are safe, meet basic standards and are managed in a satisfactory way.
The landlord licence fee is £695 per single-household property to cover the five-year period of the designation. This will be used for the running cost of the scheme. Extra charges will apply for multiple-household properties.
Discounts may be available for landlords applying early or if they are a member of a recognised landlord association.
