What is an HMO? How the Legal Definition Affects Planning and Licensing

The Statutory Definition

A House in Multiple Occupation (HMO) is defined under the Housing Act 2004. A property is an HMO if it is occupied by three or more people who form two or more separate households, and those people share, or lack, basic amenities such as a bathroom, toilet, or kitchen.

A "household" means a single person or members of the same family living together. Two unrelated students sharing a flat therefore form two households; a couple counts as one household.

The Three HMO Tests

For a property to be an HMO under the Housing Act 2004, it must satisfy all three of the following:

Planning Use Classes and HMOs

The Town and Country Planning (Use Classes) Order 1987 (as amended) is relevant alongside the Housing Act definition. Under planning law:

• **Class C3**, standard dwelling house (up to 6 people forming a single household)
• **Class C4**, small HMO occupied by 3–6 people who are not a single household and who share basic amenities

Converting a property from Class C3 to Class C4 is, in many areas, Permitted Development, meaning planning permission is not required. However, many local authorities have made **Article 4 Directions** that remove this permitted development right in areas of high HMO concentration, meaning planning permission must be sought before converting a property.

Large HMOs accommodating seven or more occupants do not fall within Class C4 and require a sui generis use, meaning full planning permission is always needed.

Mandatory HMO Licensing

Since 2006, and extended in October 2018, mandatory HMO licensing applies to any HMO in England that:

• Is occupied by **five or more persons** forming **two or more households**, and
• The occupiers share (or lack) an amenity

Prior to October 2018, mandatory licensing only applied to HMOs of three or more storeys. The 2018 extension removed the storey requirement, bringing a significant number of additional properties, including flats above shops and single-storey purpose-built HMOs, within mandatory licensing.

Additional and Selective Licensing

In addition to mandatory licensing, local authorities can introduce:

• **Additional licensing schemes**, extending licensing requirements to HMOs below the mandatory threshold
• **Selective licensing schemes**, applying to all privately rented properties in a defined area, not just HMOs

Landlords must check with their local authority whether any such scheme applies to their property.

Management Regulations

Licensed HMOs must comply with the Management of Houses in Multiple Occupation (England) Regulations 2006, which impose duties on managers regarding:

• Fire safety (alarms, means of escape, fire doors)
• General safety and maintenance of common areas
• Water supply and drainage
• Ventilation and lighting
• Waste management

Why the Definition Matters for Owners

Getting the HMO classification wrong has serious consequences. Operating a licensable HMO without a licence is a criminal offence, and local authorities can issue unlimited fines. Tenants can apply to the Rent Repayment Tribunal for repayment of up to 12 months' rent if the property was unlicensed.

Property Passport UK records whether a property is registered as an HMO alongside its other official data, which can be useful during due diligence when purchasing an investment property.