Houses in Multiple Occupation (HMO’s) provide an important supply of housing, often to vulnerable households. Research has shown that tenants living in a HMO can be adversely affected by the actions of another occupant, therefore, it is essential that high standards of management are in place.
An HMO is defined as a property comprising of 3 or more unrelated persons in two or more households who may share amenities such as bathroom, toilet and cooking facilities. This also includes properties which have been converted into self-contained flats which do not meet the 1991 Building Regulations and at least 1 third are occupied under short-hold tenancies.
The Housing Act 2004 has introduced the mandatory licensing of larger Houses in Multiple Occupation which are 3 or more storeys with 5 or more occupiers making up 2 or more households, and the option for local authorities to include smaller HMO's as part of their additional licensing schemes.
Rochdale Borough Council has taken up this option and included its smaller HMO's into their Licensing Scheme, which means 2 storey properties and properties with 3 or more individuals or households.
Department for Communities and Local Government - more information on HMO.
The criteria for licensing are:
Mandatory licensing: will apply to HMO's with 3 or more storeys, occupied by 5 or more persons and who form 2 or more households.
Additional licensing: can be introduced by local authorities (with government consent) to licence smaller HMO's where deemed necessary.
Selective licensing: covers all private rented properties within a selective area designated by a local authority. The local authority must be able to show that the area is suffering from low demand and/or anti social behaviour.
We will be introducing additional licensing to licence smaller HMO's but we will not, at this stage, be introducing selective licensing.
To apply for a licence, you will need to contact the Landlord Licensing team for an application form. You will need to demonstrate to the local authority that:
- You are a ﬁt and proper person. This may involve providing a Criminal Records Bureau disclosure showing you have no relevant criminal convictions.
- You have adopted procedures for tackling anti- social behaviour issues.
- The property is suitable for the number of occupants.
- Satisfactory management standards are in place.
- Satisfactory measures for dealing with tenancy issues are in place.
Does my property need an HMO licence? - pre application questionnaire (63kb pdf)
When a licence is not required
Just because a property is a HMO, it does not automatically follow that it needs a licence.
Those not required to obtain a mandatory licence include:
- HMO's that are entirely occupied by freeholders or long leaseholders.
- Building or ﬂats that are occupied by 2 single people (households).
- HMO's owned and managed by educational establishments and buildings regulated by other legislation, such as residential care homes or bail hostels.
- Buildings occupied by the leaseholder and their household, and 2 or fewer lodgers.
- Buildings converted into self-contained ﬂats that meet, as a minimum the standard laid down in Building Regulations 1991.
However, if the property falls within the designated selective licensing area, they will require a selective licence.
Application evaluation process
Licences will be granted if:
- The house is three storey, has 5 or more tenants that share facilities.
- The applicant is a fit and proper person and the most appropriate person to hold the licence.
- The proposed manager has control of the house, and is a fit and proper person to be the manager.
- The management arrangements are satisfactory.
If you fail to apply for a licence, there are a range of sanctions that could be applied:
- It is a criminal offence to operate a licensable HMO without applying for a licence. On conviction, you could face a ﬁne of up to £20,000.
- It is a criminal offence to breach your licensing conditions. On conviction, you could face a ﬁne of up to £5,000.
- If the council cannot grant a licence or a licence is revoked, an Interim Management Order (IMO) must be made. This will transfer the management of the property to the local authority. The council can then spend monies received through rents to cover the costs of managing the property.
- If a landlord operates a licensable HMO without a licence, section 21 procedures to evict tenants cannot be used.
- Any rent received while the property was unlicensed may have to be paid back to the local authority or in certain circumstances the tenant.
Will tacit consent apply?
No. It is in the public interest that the authority must process your application before it can be granted. If you have not heard from the local authority within a reasonable period, please contact us.
Apply for a licence
The cost of a 5 year licence is as follows: £768 + £39 inspection fee per habitable room.
For example: HMO with 8 bedrooms, 1 communal kitchen, 1 communal lounge, 1 communal dining room, 2 bath or shower rooms and 2 separate water closets = standard application fee of £768 plus inspection fee of 10 habitable rooms at £39= £390.
Total fee = £1158 for 5 years (£231.60 per year).
A licence will normally last for 5 years but in certain circumstances a licence can be granted for a shorter period.
Failed application redress
We would ask that you contact the council's Landlord Licensing team initially to try and resolve the issue. If you feel that the council has acted unfairly by failing to grant, revoking or imposing certain sanctions on your licence, you can appeal to the Residential Property Tribunal (RPT).
The RPT is an expert independent tribunal that will act instead of the County Court to either overturn or conﬁrm the council’s decision. The RPT cannot award costs unless it is found that one party acted unreasonably.