Do I Need an HMO Licence? A Guide to Mandatory and Additional Licensing

A House in Multiple Occupation (HMO) is a property rented out by at least three people who form more than one household and share facilities such as a bathroom or kitchen. If you let a property that meets this definition, you may need an HMO licence from your local authority. Operating an unlicensable HMO is a criminal offence with unlimited fines.

Mandatory HMO licensing applies throughout England to properties occupied by five or more people forming two or more households. This is a national requirement set by the Housing Act 2004 (as amended). If your property meets these criteria, you must apply for a licence regardless of which local authority area you’re in.

Additional HMO licensing schemes are declared by individual local authorities and can cover smaller HMOs that fall outside the mandatory scheme. These schemes vary significantly between councils — some cover all HMOs occupied by three or more people, while others target specific property types or areas. You must check with your local authority whether an additional licensing scheme applies to your property.

To obtain an HMO licence, you must demonstrate that the property meets prescribed standards for room sizes, amenities (bathrooms, kitchens), fire safety, and general management. The licence holder must be a fit and proper person, and the property must not be overcrowded. Licence conditions typically include requirements for gas safety certificates, EICRs, fire safety measures, and waste management.

HMO licence fees vary by local authority and typically range from £500 to £1,500 for a five-year licence. Penalties for operating without a licence are severe: unlimited fines on prosecution, rent repayment orders of up to 12 months’ rent, and the potential inability to serve Section 21 notices. Some authorities have issued penalties of £30,000 or more.

Custodia helps landlords and managing agents track HMO licence expiry dates, licence conditions, and related compliance requirements such as fire safety and electrical safety across their HMO portfolios.