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HMO legislation - what you need to know

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September sees the annual flood of students into the market for private rented accommodation. 

With some notable exceptions, economically challenged students are by and large in search of cheaper and more basic accommodation – the type of accommodation well-served by a so-called House in Multiple Occupation (HMO).

An HMO is simply let accommodation housing at least three people, making up more than one household unit and sharing facilities such as a toilet and bathroom or kitchen.

HMOs and landlords’ obligations 

Landlords contend with an increasingly large number of laws, rules and regulations in respect of their property and their relationship with their tenants – largely, but not exclusively, related to health and safety issues.

In the case of property which is let as an HMO, those obligations and responsibilities are greater than normal – because of the perceived increase in risks to tenants who are sharing such basic communal facilities as bathrooms and kitchens.

That increased risk is also reflected in the need for specialist HMO insurance to safeguard the landlord’s investment in the structure and fabric of the building and its contents, together with the general liabilities which are faced by the buy to let business.

HMO licensing

The enforcement of the special rules and regulations governing HMOs is delegated to local authorities, who have the responsibility for licensing their use.

Any type of HMO may be subject to the requirement for a licence from the local authority, but if it is defined as a “large HMO”, a licence is essential. A large HMO is one that extends over three or more floors, has five or more tenants, all of whom are sharing toilet and bathroom or kitchen facilities.

An HMO licence is valid for five years only and must be renewed before it expires, if the property remains in use as an HMO. Applications may be made online.

Licensing conditions

A number of the licensing conditions are directly related to the physical safety of your tenants:

  • as with any other let property, you must obtain an annual gas safety certificate (following inspection by an engineer registered by Gas Safe), but in the case of an HMO, that certificate must be sent to the local authority;
  • smoke alarms and carbon monoxide detectors must be installed according to the relevant fire regulations; and
  • safety certificates for all electrical appliances must be provided whenever requested by the local authority. 

In addition, there are rules governing overcrowding and the way in which the HMO is managed, so that:

  • it must be a suitable size, with the appropriate standard of facilities, for the number of people living there;
  • if you or your tenants make any changes to the HMO, the local authority must be informed; 
  • if the circumstances of any of your tenants change – for example, if a child is born to them – the local authority must be told; and 
  • the manager of the HMO – or an agent – must be considered by the local authority to be a “fit and proper” person (someone who has no criminal record, for example, and who has no past record of breaches of landlord legislation or codes of practice).

In addition to these basic requirements, the local authority is entitled to make further conditions of the licence – relating, say, to the standard of facilities provided by the HMO – and these may be revealed during the Housing Health and Safety Rating System (HHSRS) risk assessment which the local authority is obliged to conduct within 5 years of receiving your licence application.

Further reading: Free Guide to HMO Insurance