Call of the month: Do I need a HMO licence?
A member gave us a call recently with a question about whether they need to have a House of Multiple Occupation (HMO) licence.
They told our adviser that they have a two-storey property with three bedrooms. There are now four people living at the property, from three different households.
They said they thought this would be classed as a small HMO and wanted to find out whether they needed to obtain a licence or not.
The advice from our team
Our adviser began by explaining to this landlord the definition of a HMO.
At its most basic, a HMO is a property occupied as the primary residence of three or more people, living in two or more households.
However, there are a number of different definitions of a HMO set out in the Housing Act 2004 that complicate this definition, and members can read more about this in our licensing guidance.
In relation to our member's question, the adviser explained the property they rent out would not be subject to mandatory licensing.
Since 1 October 2018 in England a HMO will usually fall within the mandatory licensing regime if it:
- Is occupied by five or more persons; and
- Is occupied by persons living in two or more separate households; and
- It is not a self-contained flat in a purpose built block comprising three or more flats.
While our landlord's property does not meet this definition, our advisor explained that this is not to say that the property is exempt from licensing altogether.
This is because the property could be in an area where an additional HMO licensing scheme is in force.
The criteria for an additional licensing scheme is set by the local authority and can potentially apply to any HMO property, even those with only three occupants.
The penalties for not having the correct licence are very high for landlords, so our adviser recommended the landlord visits the local authority website where the property is located to check whether a licence is required, as soon as possible.
Areas where an additional HMO licensing scheme or a selective licensing scheme is in place will be listed on the council’s website, if there are licensing schemes in force. There will also be information for landlords around how to apply for a licence.
Landlords can read more about HMO licensing in our guidance exclusive for members. The guidance now includes a useful HMO licence application checklist, which outlines the key things landlords are likely to need ahead of submitting an application for a HMO licence.