Do I need a HMO licence?

The Housing Act 2004 came into force on 6 April 2006.

The Act introduces the mandatory licensing of Houses in Multiple Occupation (HMOs), as from 6 April 2006 it is compulsory to licence larger, higher-risk HMOs.

Why does the Government want HMOs to be licensed?

Larger HMOs, such as bedsits and shared houses, often have poorer physical and management standards than other privately rented properties. It is widely accepted that HMOs often contain the worst housing conditions and the greatest risk of fire. Three storey or more HMOs pose the greatest risk to the health and safety of the occupiers. The people who live in HMOs tend to be amongst the most vulnerable and disadvantaged members of society and as HMOs are the only housing option for many people, the Government recognises that it is vital that they are properly regulated and therefore the Landlord or managing Agent of those properties is now legally required to hold a licence.

Licensing is intended to make sure that:

  • landlords of HMOs are fit and proper people, or that they employ managers who are 
  • each HMO is suitable for occupation by the number of people allowed under the licence 
  • the standard of management of the HMO is adequate 
  • high risk HMOs can be identified and targeted for improvement

Do I need a licence for my HMO?

The Housing Act 2004 makes it compulsory to licence all Houses in Multiple Occupation that are:

  • three or more storeys, including basements and attics (even if the lower storeys are used for industrial or commercial use such as a shop) 
  • occupied by five or more people, including children 
  • occupied by two or more households

If your property meets all the above conditions then it must be licensed with effect from 6 April 2006.

How will it work?

Anyone who owns or manages an HMO that must be licensed has to apply to the Council for a licence. The Council must give a licence if it is satisfied that the:

  • HMO is reasonably suitable for occupation by the number of people allowed under the licence 
  • proposed licence holder is a ‘fit and proper person’ 
  • proposed licence holder is the most appropriate person to hold the licence 
  • proposed Manager (if any) is ‘fit and proper’ 
  • proposed management arrangements are satisfactory, the person involved in the management of the HMO is competent and the financial structures for the management are suitable.

What are the penalties for failing to licence an HMO?

It is an offence for the landlord or person in control of the property:

  • to fail to apply for a licence for a licensable property; or 
  • to allow a property to be occupied by more people than are permitted under the licence.

A Landlord or person acting on his behalf operating an unlicensed HMO faces a fine of up to £20,000. and a criminal record.

A Landlord or person acting on his behalf who breaks any of the licence conditions faces fines of up to £5,000.

What does ‘fit and proper person’ mean?

In deciding whether someone is fit and proper, the Council must take into account:

  • any previous convictions relating to violence, sexual offences, drugs and fraud 
  • whether the proposed licence holder has broken any laws relating to housing or landlord and tenant issues 
  • whether the person has been found guilty of unlawful discrimination 
  • whether the person has previously managed HMOs that have broken any approved code of practice.

The Council may carry out further checks to make sure that the person applying for the licence is a fit and proper person. It is advisable for the landlord or manager to be a member of a professionally recognised body, or an approved landlords association that is affiliated to the National Federation of Residential Landlords.

What is in a licence?

The licence will specify the maximum number of people who may live in the HMO. It will also include the following conditions, which apply to every licence:

  • a valid current gas safety certificate, which is renewed annually, must be provided 
  • proof that all the electrical appliances and furniture are kept in a safe condition 
  • proof that the fire detection system is installed and functioning correctly 
  • each occupier must have a written statement of the terms on which they occupy the property, ie a tenancy agreement.

The Council may also apply the following conditions:

  • restrictions or prohibitions on the use of parts of the HMO by occupants 
  • the landlord or manager must take steps to deal with the behaviour of occupants or visitors 
  • to ensure that the condition of the property, its contents such as furniture and all facilities and amenities, bathrooms and toilets for example, are in good working order. 
  • To carry out specific works or repairs within a particular timeframe 
  • A requirement that the responsible person attends an approved training course

How long does the licence last?

A licence will normally last for a maximum of 5 years, although it can be for a shorter period.

How much does the licence cost?

Please contact the HMO team on 01274 434520 for current fee details.

Can the Council refuse to licence a HMO?

Yes, if the property does not meet the conditions set out above and / or the landlord or manager is not a fit and proper person

What will happen if the Council refuse to licence a HMO?

Where it is deemed that a property or person is unsuitable for the granting of a licence and there is little prospect of being able to do so, the Council can eventually issue an Interim Management Order (IMO), this allows it to step in and manage the property. The owner keeps their rights as an owner. The order can last for a year until suitable permanent management arrangements can be made. If the IMO expires and there has been no improvement, then the Council will issue a Final Management Order. This can last up to 5 years and can be renewed after that.

Can I appeal against the Council's decision?

You may appeal if the Council decides to:

  • refuse a licence 
  • grant a licence with conditions 
  • revoke a licence 
  • vary a licence 
  • refuse to vary a licence

You must make your appeal to the Residential Property Tribunal

Temporary exemption from licensing

If a Landlord or person in control of the property intends to stop operating as a HMO or reduce the numbers of occupants and can give clear evidence of this, then she or he can apply for a Temporary Exemption Notice. This lasts for a maximum of three months and ensures that a property in the process of being converted from a HMO does not need to be licensed. If the situation is not resolved, then a second Temporary Exemption Notice can be issued. When this runs out the property must be licensed, become subject to an Interim Management Order, or cease to be a HMO.

Rent repayment orders

A tenant living in the property that should have been licensed, but was not, may be able to apply to the Residential Property Tribunal to claim back any rent they have paid during the unlicensed period (up to a limit of 12 months). Councils can also reclaim any Housing Benefit that has been paid during the time that the property was without a licence.

How do I apply for a licence?

You can download the application forms from this website.

For further information on HMO licensing you can contact the Houses in Multiple Occupation Team.

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Housing Standards Team
8th Floor, Margaret McMillan Tower
Princes Way,

Phone : 01274 434520
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Council Switchboard : 01274 432111

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