A house in multiple occupation (HMO) is defined as a property rented out by at least 3 people who are not from 1 ‘household’ but share facilities, for example the bathroom and kitchen.
If you want to rent out your property as a HMO in either England or Wales you must contact your local council to check if you need a licence, as regulations do vary in different areas.
You must have a licence if you’re renting out a large HMO in England or Wales. A property is defined as a large HMO if all of the following apply:
- it is rented to 5 or more people who form more than 1 household
- some or all tenants share toilet, bathroom or kitchen facilities
- at least 1 tenant pays rent (or their employer pays it for them)
Even if your property is smaller and rented to fewer people, you may still need a licence depending on the area. Again we advise that you check with your local council.
Bear in mind that there are several restrictions regarding HMO licencees. Firstly, a licence is only valid for five years and must be renewed before it runs out.You will also need a separate licensed for each HMO that you run.
In addition to this, you must make sure that:
- the house is suitable for the number of occupants
- the manager of the house – you or an agent – is considered to be ‘fit and proper’, for example they have no criminal record or breach of landlord laws or code of practice
You must also adhere to any health and safety regulations as necessary, eg providing the council with an updated gas safety certificate every year, installing and maintaining smoke alarms and carrying out electrical testing when requested.
The council may add other conditions to your licence, for example improving the standard of your facilities.
You should apply for the licence yourself (if you use a managing agent they can apply for you) and you will be charged a fee which is set by the council.
If you do not have the relevant licence you could get an unlimited fine for renting out a HMO.