Mandatory HMO Licensing UK 2026 — Threshold, Application, Licence Conditions, and Penalties for Non-Compliance

The mandatory HMO licensing threshold — 5 or more persons, 2 or more households

The mandatory licensing threshold under the Housing Act 2004 s.55(2) applies to a house in multiple occupation (HMO) that meets both the occupancy test and the household test:

• Occupancy test — 5 or more persons: The property must be occupied (or available for occupation) by 5 or more persons. Counting: each individual tenant counts as one person. Where rooms are shared by couples, both partners count separately (unless the couple are a single household — but a cohabiting couple is a single household, not two). A landlord who lives in the property as a resident landlord also counts as a person but forms their own household
• Household test — 2 or more households: The persons must form 2 or more households. A household is defined in the Housing Act 2004 s.258: persons are members of the same household if they are members of the same family (including cohabiting couples). Unrelated tenants each form their own single-person household. So 5 unrelated tenants form 5 separate households — easily satisfying the 2-household minimum
• 3-storey requirement removed 1 October 2018: Before 1 October 2018, mandatory licensing applied only to HMOs of 3 or more storeys. This requirement was removed by the Licensing of Houses in Multiple Occupation (Mandatory Conditions) (England) Regulations 2018. From 1 October 2018, a two-storey house or a ground-floor flat occupied by 5+ persons from 2+ households requires a mandatory licence
• Exemptions from mandatory licensing: Certain properties are exempt from mandatory licensing even if they meet the threshold: buildings managed or owned by a body with charitable status under the relevant regulations; purpose-built blocks of flats if only one flat is an HMO; buildings regulated under other schemes (care homes, prisons, student accommodation managed by educational institutions). These exemptions are narrow and most private landlords will not benefit from them

Licence application — process, fees, and duration

A landlord who operates an HMO that meets the mandatory threshold must apply for a licence from the local housing authority (usually the district or borough council). Licensing is administered by the local authority for the area where the property is located:

• Application process: Applications are made to the local housing authority. The authority will assess: the fitness of the licence holder and any proposed manager (the 'fit and proper person' test — criminal record checks, previous licensing history, compliance history); the suitability of the property for the proposed number of occupiers; whether the management arrangements are satisfactory; whether the property meets prescribed standards for room sizes, fire safety, gas and electrical safety
• Fit and proper person test: HA 2004 s.66 requires the authority to be satisfied that the proposed licence holder and any proposed manager is a fit and proper person. Factors that can cause a person to fail this test: previous convictions for fraud, violence, sexual offences, or housing offences; previous licensing decisions; inclusion on the landlord database (from 2025)
• Licence duration and fees: A mandatory HMO licence lasts for a maximum of 5 years. The local housing authority sets the fee. Typical fees range from £500 (smaller properties, efficient authorities) to £1,500 or more (London authorities, complex applications). Many authorities charge a two-part fee: an application fee (non-refundable) plus a grant fee payable on licence grant. Some authorities offer fee discounts for accredited landlords
• Interim licences and temporary exemptions: Where a landlord urgently needs to let a property while a full licence application is pending, the local authority can grant a temporary exemption notice (TEN) for up to 3 months (renewable once for a further 3 months). A landlord who intends to apply for a licence but has not yet done so should apply for a TEN immediately to avoid operating an unlicensed HMO

Mandatory licence conditions — what must every licensed HMO comply with?

The Licensing of Houses in Multiple Occupation (Mandatory Conditions) (England) Regulations 2018 prescribe conditions that must be included in every mandatory HMO licence. These are not discretionary — every mandatory licence must contain them:

• Annual gas safety check: The licence holder must ensure a gas safety check is carried out annually by a Gas Safe registered engineer and that a copy of the gas safety record is provided to each tenant within 28 days of the check being completed
• EICR every 5 years: An Electrical Installation Condition Report (EICR) must be carried out by a qualified electrician every 5 years (or at any change of tenancy, whichever is sooner). The EICR must be satisfactory (no Category 1 or Category 2 defects). A copy must be provided to the local authority within 7 days of request
• Smoke and CO alarms: A working smoke alarm must be installed on each storey used for habitation. A working carbon monoxide alarm must be installed in any room used for habitation that contains a fixed combustion appliance (including gas boilers). Alarms must be in working order at the start of each tenancy
• Minimum room sizes: Bedrooms used for sleeping by one person aged 10 or over must be at least 6.51m². Bedrooms used for sleeping by two persons aged 10 or over must be at least 10.22m². No child under 10 may occupy a room below 4.64m². The licence holder must notify the local authority within 14 days if a room falls below the minimum size requirement for the number of occupants

Penalties for operating an unlicensed HMO — £30,000, rent repayment orders, and criminal prosecution

The consequences of operating an HMO without a mandatory licence (or in breach of licence conditions) are severe:

• Civil penalty of up to £30,000: Under HA 2004 s.72A (inserted by Housing and Planning Act 2016), local housing authorities may impose a civil penalty of up to £30,000 on a person who operates an unlicensed HMO or breaches a licence condition. Civil penalties are a 'per breach' power — a landlord with multiple unlicensed HMOs can face multiple penalties. The authority must follow a prescribed civil penalty procedure (notice, right of reply, final notice, appeal to FTT)
• Rent repayment order (RRO): Under Housing and Planning Act 2016 ss.40-41, both the local authority AND the tenant can apply to the FTT for a rent repayment order requiring the landlord to repay up to 12 months' rent where the landlord has operated an unlicensed HMO. A tenant who has paid rent for a property that was an unlicensed HMO can apply for an RRO even after leaving the property (up to 12 months after the offence). The FTT has wide discretion in determining the amount
• Criminal prosecution: Operating an unlicensed mandatory HMO remains a criminal offence under HA 2004 s.72. On summary conviction, the maximum fine is unlimited (since 2015). Criminal prosecution is now used less frequently as civil penalties are preferred, but particularly egregious or persistent non-compliance may result in prosecution
• Unenforceable rent increases: A landlord who is operating an unlicensed mandatory HMO cannot serve a valid Section 13 notice to increase rent under the Renters' Rights Act 2025. The Housing Act 2004 s.75 restricts the enforcement of rent obligations for unlicensed HMOs. Licensing compliance is therefore essential for landlords who wish to implement rent increases post-RRA 2025

Frequently asked questions