Whether you’re a landlord, property manager, or investor, understanding HMOs — Houses in Multiple Occupation — is essential for operating legally and profitably in today’s rental market.
An HMO is any property rented by multiple tenants who are not from the same household but share common facilities like a kitchen or bathroom. These types of rentals are popular across the UK, particularly in urban areas with high demand for affordable, shared housing.
But with greater rental potential comes greater responsibility.
In this guide, we’ll break down everything you need to know about HMOs — including licensing rules, legal obligations, the application process, and the financial advantages. Whether you’re managing a single shared house or a growing portfolio, this page will help you stay compliant and confident as an HMO landlord.
An HMO (House in Multiple Occupation) is a property rented out by three or more people who are not from the same household and who share basic facilities such as a kitchen, bathroom, or toilet.
HMOs are commonly used by:
Students
Young professionals
Flat sharers
Low-income tenants seeking affordable housing
The key feature that makes a property an HMO is multiple households living under one roof, typically under separate tenancy agreements.
A 4-bedroom house rented to 4 unrelated individuals who each have their own room and share the kitchen and bathroom
A flat rented to 3 friends who are not related, even if they all signed one joint tenancy
A property split into bedsits with shared kitchen or bathroom facilities
A single-family renting a house or flat
A couple and their child renting a property
Two siblings or cousins sharing a home
Not every shared property automatically needs a license, but many do, and failing to obtain one can lead to serious fines. Whether you need a license depends on how many tenants live in the property, how many households they represent, and your local council’s rules.
You must have a mandatory HMO license if your property meets all of the following:
It’s rented to five or more people
The tenants form two or more households
They share kitchen, bathroom, or toilet facilities
This rule applies across all of England and Wales.
Some councils, especially in cities like London , have additional licensing schemes. This means you may need a license even if your property is smaller (for example, housing just 3 or 4 people from different households).
Each local authority sets its own rules, so it’s important to check the requirements in your borough.
Selective licensing is not specific to HMOs, it can apply to any privately rented property in certain designated areas. If your property is in a selective licensing zone, you’ll still need to apply for a license,
Many landlords assume that if they meet HMO licensing requirements, they’re fully compliant , but this is not always the case.
Even if you have a valid HMO licence, you could still be in breach of planning regulations. In boroughs with an Article 4 Direction, simply letting a property to 3 or more unrelated tenants without formal planning permission can result in:
Enforcement notices from the council
Orders to return the property to single-family use
Problems when refinancing or selling
Fines and delays if challenged by tenants or neighbours
Licensing and planning are two separate legal processes , you may need both. Don’t rely on your agent or assume previous use was lawful. Always check with your local planning authority before converting or letting out an HMO.
If your property qualifies as an HMO, you must follow a specific process to apply for a licence through your local council. While exact requirements may vary slightly between boroughs, the overall steps are generally consistent across the UK.
Before anything else, confirm whether your property meets the criteria for mandatory, additional, or selective licensing. You can do this by reviewing your local council’s website or using a simple HMO checker tool.
Each council requires a range of supporting documents for your licence application. These typically include:
A floor plan showing room sizes and layout
Gas Safety Certificate (CP12)
Electrical Installation Condition Report (EICR)
Fire alarm and emergency lighting certificates
Tenancy agreements
Proof of property ownership or management
Applications are submitted online via your borough’s licensing portal. Most councils charge a fee, which can range from £500 to over £1,000 depending on the size and type of property.
Some boroughs split the fee into:
Part A (application and processing)
Part B (licence grant after inspection)
A housing officer may inspect the property before the licence is approved. They’ll check for:
Fire safety measures (alarms, fire doors, escape routes)
Adequate kitchen and bathroom facilities
Proper waste disposal
Cleanliness and general condition
Room sizes and overall occupancy suitability
If your property meets the standards, you’ll be issued an HMO licence, usually valid for five years. However, the council can issue shorter licences in cases where there are previous breaches or concerns.
HMO licensing comes with several costs beyond just the application fee. Landlords should budget not only for the licence itself but also for required certificates, safety upgrades, and ongoing compliance.
Each local council sets its own licensing fees, and they often vary depending on:
The size of the property
The number of tenants
Whether it’s a new application or a renewal
Accreditation status of the landlord
Typical fees range from £500 to £1,400. For example:
Hackney Council: from £950 to £1,400
Westminster Council: approximately £1,100
Tower Hamlets: from £520 for small HMOs up to £1,300 for larger ones
Some councils offer discounts for accredited landlords or early applications.
To obtain and maintain your licence, you’ll likely need to pay for:
Gas Safety Certificate (annual): £60–£90
EICR (Electrical Safety Report): £150–£300
Fire risk assessment: £100–£250
Fire alarms and emergency lighting upgrades: varies by property
Professional floor plan: £50–£150
These are not optional — councils can refuse or revoke your licence if you don’t meet minimum safety and amenity standards.
If the property doesn’t already meet HMO standards, you may also need to invest in:
Fire doors
Heat/smoke detectors
Emergency lighting
Additional kitchen or bathroom facilities
Waste storage improvements
Avoiding licensing to save money is a high-risk mistake. Fines can reach up to £30,000, and tenants can apply for Rent Repayment Orders to recover up to 12 months of rent from unlicensed landlords.
HMO rules and licensing schemes are not the same across the UK , and in London, they can vary dramatically from one borough to the next.
Some councils require a licence for just three tenants, while others apply additional standards for things like fire safety, room sizes, and amenities. These local rules are constantly evolving, and many councils run public consultations or launch new schemes with limited notice.
That’s why it’s essential to check the current requirements directly with your local authority.
Owning a home is a keystone of wealth… both financial affluence and emotional security.
