Houses in Multiple Occupation (HMOs)
This page includes:
- What is a HMO?
- Which HMOs require a Licence?
- What criteria must a HMO meet for it to be licensed?
- What is meant by 'reasonably suitable for occupation'?
- What does the term 'fit and proper person' mean?
- What are considered to be 'satisfactory management arrangements'?
- Are there conditions attached to a licence?
- How long does a licence last?
- Do I have a right to appeal against licensing decisions that I consider to be unreasonable?
- How much will the licence cost?
- What is the penalty for not having a licence?
- What is an Interim Management Order?
- Will you inspect the HMO before issuing a Licence?
- What is the Housing Health and Safety Rating System (HHSRS)?
- What about Planning Permission?
- What About Non-Licensable HMOs?
- Where can I get more information?
This definition not only encompasses the traditional bedsit type accommodation but also any instances where people share any facilities. In the case of student accommodation it should be noted that each student constitutes a single household, therefore shared student houses will fall under this definition of a HMO.
Section 254 of the Act states -
(1) For the purposes of this Act a building or a part of a building is a "house in multiple occupation" if -
(a) it meets the conditions in subsection (2) ("the standard test");
(b) it meets the conditions in subsection (3) ("the self-contained flat test");
(c) it meets the conditions in subsection (4) ("the converted building test");
(d) an HMO declaration is in force in respect of it under section 255; or
(e) it is a converted block of flats to which section 257 applies.
(2) A building or part of a building meets the standard test if -
(a) it consists of one or more units of living accommodation not consisting of a self-contained flat or flats;
(b) the living accommodation is occupied by those persons as their only or main residence or they are to be treated as so occupying it (see section 259);
(c) the living accommodation is occupied by those persons as their only or main residence or they are to be treated as so occupying it (see section 259);
(d) their occupation of the living accommodation constitutes the only use of that accommodation;
(e) rents are payable or other consideration is to be provided in respect of at least one of those persons' occupation of the living accommodation; and
(f) two or more of the households who occupy the living accommodation share one or more basic amenities or the living accommodation is lacking in one or more basic amenities.
(3) A part of a building meets the self-contained flat test if -
(a) it consists of a self-contained flat; and
(b) paragraphs (b) to (f) of subsection (2) apply (reading references to the living accommodation concerned as references to the flat)
(4) A building or part of a building meets the converted building test if -
(a) it is a converted building;
(b) it contains one or more units of living accommodation that do not consist of a self contained flat or flats (whether or not it also contains any such flat or flats);
(c) the living accommodation is occupied by persons who do not form a single household (see section 258);
(d) the living accommodation is occupied by those persons as their only or main residence or they are to be treated as so occupying it (see section 259);
(e) their occupation of the living accommodation constitutes the only use of that accommodation; and
(f) rents are payable or other consideration is to be provided in respect of at least one of those persons' occupation of the living accommodation.
- (5) But for any purposes of this Act (other than those of Part 1) a building or part of a building within subsection (1) is not a house in multiple occupation if it is listed in Section 14.
(6) The appropriate national authority may by regulations -
(a) make such amendments of this section and sections 255 to 259 as the authority considers appropriate with a view to securing that any building or part of a building of a description specified in the regulations is or is not to be a house in multiple occupation for any specified purposes of this Act;
(b) provide for such amendments to have effect also for the purposes of definitions in other enactments that operate by reference to this Act;
(c) make such consequential amendments of any provision of this Act, or any other enactment, as the authority considers appropriate.
- (7) Regulations under subsection (6) may frame any description by reference to any matters or circumstances whatever.
- (8) In this section -"basic amenities" means -
- (a) a toilet.
- (b) personal washing facilities, or
- (c) cooking facilities; "converted building" means a building or part of a building consisting of living accommodation in which one or more units of such accommodation have been created since the building or part was constructed; "enactment" includes an enactments comprised in subordinate legislation (within the meaning of the Interpretation Act 1978 (c.30) "self contained flat" means a separate set of premises (whether or not on the same floor) -
- (a) which forms part of a building;
- (b) either the whole or a material part of which lies above or below some other part of the building; and
- (c) in which all three basic amenities are available for the exclusive use of its occupants.
- In practical terms this means any building or part of a building (e.g. a flat)
- which is occupied by more than one household (and more than two people) and in which more than one bathroom, toilet or cooking facilities; or
- which is occupied by more than one household and which is a converted building which does not entirely comprise self contained flats (whether or not there is also a sharing or lack of amenities); or
- which is comprised entirely of converted self contained flats and the standard of conversion does not meet, at a minimum, that required by the 1991 Building Regulations and at least one third of the flats are occupied under short tenancies.
Mandatory licensing will apply to HMOs which are:
- Three storeys or more (storey includes residential basements, attics and commercial units; and
- Occupied by five or more persons (who are not all members of the same family unit) as their only or main place of residence (full-time students in further or higher education and persons in refuge accommodation are treated as occupying premises as their only or main place of residence).
But not if the property is:
- Occupied by you and members of your family and no more than 2 lodgers
- Converted into self-contained flats to 1991 (or more recent) Building Regulation Standards
- Converted into self-contained flats and two thirds or more or the flats are occupied by long leaseholders and/or their families (a long lease is 21 years or more)
- Managed/controlled directly by a registered social landlord (housing association), a local housing authority, a police authority or a health service body
- Occupied by full-time students and managed directly by their educational establishment
- Occupied principally for the purposes of a religious community
Section 64 of the Act sets out the matters to be satisfied for a licence to be granted. These are -
- the house should be reasonably suitable for occupation by not more than the number of people specified in the licence application.
- the proposed licence holder must be a "fit and proper person"
- the proposed manager (often the licence holder) must be a "fit and proper person"
- the proposed management arrangements for the house must be satisfactory
The HMO will need to satisfy standards prescribed by the Government in the form of regulations. These will cover such things as -
- number, type and quality of bathrooms, toilets etc.
- number, type and quality of facilities for food storage, preparation and cooking
- fire precautions
Unfortunately, this is not defined in the Act, but Section 66 does set out certain criteria which the Council must consider. This includes determining whether the person has -
- committed any offence involving fraud or other dishonesty, violence or drugs
- practiced unlawful discrimination on grounds of sex, colour, race, ethnic or material origin or disability in relation to their business activity
- contravened any housing or landlord and tenant legislation.
In practice, this means that the Council may require a Criminal Records Bureau (CRB) check as well as considering any information on its own records.
The Council must make judgement on whether any person who is to be involved in the management of the HMO. This includes:
- has a sufficient level of competence; and
- is a "fit and proper person"
They must also consider whether the management and funding arrangements for the property are suitable. ?This will take into account whether a person has undertaken any recognised training course, holds a recognised qualification and/or is a member of any recognised professional association.
There will be conditions attached to all licences requiring the licence holder. These are:
- to provide a copy of a current and valid gas safety certificate covering all gas appliances in the property to the Council every twelve months
- to keep portable electrical appliances and furniture provided in a safe condition
- to ensure that there is an adequate fire detection and warning system installed in the house and that it is kept in proper working order
- to supply the occupiers of the house with a written statement of their terms of occupation (tenancy agreement)
The Council can also set further conditions relating to:
- the maximum permitted number of persons that can occupy the property
- restrictions or prohibitions on the use or occupation of particular parts of the property
- taking reasonable steps to prevent or reduce anti-social behaviour by persons occupying or visiting the house
- provisions of facilities and equipment (i.e. in accordance with fire safety and amenity standards)
- time-scales for works to be completed
- proper maintenance of facilities and equipment
- Removal or reduction of category 1 and 2 hazards identified under the Housing Health and Safety Rating System (HHSRS) within a defined period (the HHSRS is a system for assessing the suitability of different types of housing and replaced the previous fitness standard)
Normally speaking, a licence is granted for five years, which is the maximum period permitted. ?However, there may be circumstances where a shorter licensing period is considered more appropriate. The licence period is subject to licence conditions being met, as the Council reserves the right to vary or revoke a licence where relevant circumstances have changed.
Yes, licence applicants may appeal to a residential property tribunal (RPT). Details of residential property tribunals can be accessed via the appropriate related link.
The Government does not set a national licence fee. Instead it is left to the discretion of each Council. In Broxtowe, the fee is intended to cover the costs of administering the licensing regime. In Broxtowe the fee, as of 1st April 2017, is £475. This will be reduced to £415 if an applicant is a member of a regional landlords' association or is making an application in respect of a second or subsequent HMO.
The penalties for not having a licence are heavy. Section 72 of the Act makes it a criminal offence to operate a relevant HMO without a licence. Anyone found guilty of this will be liable to a fine of up to £20,000. There is also the possibility of anyone found guilty of managing a HMO without a licence having a Rent Repayment Order made upon them. This, in effect, demands the repayment of any rent received by the landlord from the time they were notified that a licence was required.
An Interim Management Order (IMO) can be made by the Council to ensure that immediate steps are taken to protect the health, safety and welfare or occupiers of an HMO. The Act actually stipulates that in circumstances where the Council is unable to grant a HMO licence they should make an IMO. Once an IMO is in force the Council effectively takes over the management of the relevant property. This includes collecting all rent and taking any steps to protect the health and safety of residents.
A Council may issue a licence without inspecting the property. However, in Broxtowe, all properties are inspected before a licence is issued.
The HHSRS is the regime introduced by Part 1 of the Housing Act 2004 for assessing poor housing conditions. It replaced the fitness standard previously used by the Council to assess conditions. The HHSRS takes into account actual hazards brought about by defects in housing and compares the extent of the hazard against actual accident/illness data.
Along with this system the Act also introduced a number of new enforcement options that the Council can use when dealing with poor housing conditions, such as improvement notices, prohibition orders and even emergency prohibition powers to intervene in situations where there is an imminent risk to the health and safety of residents.
The setting up of some houses in multiple occupation will require planning permission. You are advised to contact the Planning Division at Broxtowe Borough Council to check if you require planning permission before carrying out any works.
If a property is being operated on a HMO but does not require a licence, it will still need to meet certain standards to ensure it is free of risks to tenants and visitors, has adequate space and amenity standards, and is managed properly.
The Government department responsible for the Housing Act 2004 is the Department for Communities and Local Government (CLG). There is a certain amount of information on the CLG website, including specific fact sheets on the main provisions of the Act.
There may also be information available from various other organisations and landlord associations.
- Chartered Institute Of Housing
- Chartered Institute Of Environmental Health
- Joseph Rowntree Foundation
- East Midlands Property Owners
- Residential Landlords Association
- East midlands DASH