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HMO licensing

Why licence houses in multiple occupation (HMOs)

Larger HMOs such as bedsits and shared houses, often have poorer physical and management standards than other privately rented properties. The people who live in HMOs are amongst the most vulnerable and disadvantaged members of society. As HMOs are the only housing option for many people, the government recognises that it is vital that they are properly regulated.

Licensing is intended to make sure that:

  • landlords of HMOs are fit and proper people, or 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.

Where landlords refuse to meet these criteria the Council can intervene and manage the property so that:

  • vulnerable tenants can be protected;
  • HMOs are not overcrowded;
  • Councils can identify and support landlords, especially with regeneration and talking antisocial behaviour.

Do all HMOs have to be licensed?

No. Under the Housing Act 2004 there are three types of licensing:

  1. Compulsory (required by law) licensing of HMOs for properties that are:

    • three or more storeys high;
    • have five or more people in more than one household, and
    • share amenities such as bathrooms, toilets and cooking facilities.

  2. Additional licensing of HMOs. A discretionary power that councils may decide to apply to a particular type of HMO, for example, two-storey properties occupied by three or more students of asylum seekers.

  3. Selective licensing of other residential accommodation
    Properties that are not subject to HMO licensing could be covered under a selective licensing scheme. This is where the Council may declare that certain areas, for example, where there id low demand for housing and/or antisocial behaviour, are appropriate for selective licensing. This licensing would cover all forms of private rented housing , including HMOs. It is likely that at first councils will only introduce licences for HMOs that fall into the first group. They may introduce the other two types of licensing later.

Licensing only applies to HMOs where rents or other considerations are payable.

How does HMO licensing 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;
  • the proposed licence holder is a fit and proper person;
  • the proposed licence holder is the most appropriate person to hold the licence;
  • the proposed manager, if there is one is a fit and proper person;
  • the proposed management arrangements are satisfactory;
  • the person involved in the management of the HMO is competent;
  • the financial structures for the management are suitable.

What does a 'fit proper person' mean?

The Council will carry out checks to make sure that the person applying for the licence is a fit and proper person. 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 or unlawful discrimination;
  • whether the person has previously managed HMOs that have broken any approved code of practice.

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.

HMO licence covers

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 electrical appliances and furniture are kept in a safe condition;
  • proof that all smoke alarms are correctly positioned and installed;
  • each occupier must have a written statement of the terms on which they occupy the property, for example , a tenancy agreement.

Councils may also apply the following conditions:

  • restrictions or prohibitions on the use of parts of the HMO by occupants.
  • a requirement that the condition of the property, its contents, such as furniture and all facilities and amenities, bathroom and toilets for example, are in good working order;
  • a requirement that the condition of the property, its contents, such as furniture and all facilities and amenities, bathroom and toilets for example, are in good working order;
  • a requirement for specified works or repairs to be carried out within a particular time frame;
  • a requirement that the responsible person attends an approved training course.

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

HMO licence cost

Landlords will have to pay a fee to cover the administration costs of the licence procedure. For 2017-2018, the fee has been set at £378 for a 5 bed property, £25 per room thereafter. The licence lasts for five years.

Apply or renew a HMO licence

To apply for or renew and existing HMO licence contact the Housing Team on the details below: