A landlord’s guide to HMO licensing

Customisable business insurance
31 May 2023
5 minute read

Landlords up and the down the UK will likely know the term ‘HMO’, standing for ‘house in multiple occupation’ (or ‘house of multiple occupancy’). But what exactly are HMOs, and how can you tell if your rental property fits this classification?

Furthermore, if your rental property is an HMO, then there is a fair bit of important information you need to know about how HMO licensing works so you can stay on the right side of the rules.

What is an HMO?

UK law defines a rental property as an HMO if both the following apply:

  • At least three tenants live there, forming more than one household
  • Toilet, bathroom or kitchen facilities are shared

A ‘household’ means either a single person or members of the same family who live together and this includes couples who are married or living together and people in same-sex relationships.

So, a property would be classed as an HMO if it is shared by two or more individuals or groups that are not family members, a married couple or in a relationship. A common term to describe this kind of arrangement is a ‘house share’.

HMOs account for roughly 10% of the entire private rental stock in the UK, with nearly half a million examples of this kind of rental property across the country. This number is actually in decline at the moment, with there being roughly 21,000 fewer HMOs in the UK in 2022/23 compared to two years prior, but it still accounts for a reasonable portion of the UK’s rental housing stock.

What is an HMO licence?

There are two different kinds of HMO licence that may apply to your property, depending on the size of the home and your location within the UK: mandatory and additional licences.

Mandatory HMO licence

The most common form of HMO licence is the ‘mandatory licence’. The requirements for which properties need a mandatory HMO licence depend on where in the UK your rental home is.


In England, all HMOs with five or more tenants from two or more households are required to have a mandatory HMO licence. The length of the licence and the cost will depend on the location of your property, but as a general rule, any HMO with five or more occupants in England will fall under the mandatory licensing rule.


In Wales, the rules governing which properties require a mandatory HMO licence are slightly different. To fall under the mandatory licence rules, a property must have both:

  • Three or more storeys, and;
  • Five or more occupants forming more than one household.

The Welsh government has produced a full guide to HMOs in Wales with fuller details of all licensing rules.

Northern Ireland

In Northern Ireland, there is no distinction made between mandatory and additional licences for HMOs. All houses in multiple occupation (with three or more tenants from two or more households) must be licensed by their local council.


In Scotland, there is similarly no distinction made between mandatory and additional licences, and all HMOs must be licensed, with the landlord’s details added to the Scottish Landlord Register.

Additional HMO licence

In England and Wales, local councils have the power to impose additional licensing requirements on HMOs that would not otherwise be regulated by the mandatory licensing rules.

These additional licence requirements vary by local authority, but will often cover HMO properties with three or four tenants from two or more households which might not otherwise be required to hold a mandatory licence.

It’s best to check with your local council via their website to see whether additional licences are required in your area.

How to get an HMO licence

How an HMO is defined is the same across the UK, and taken from the wording of the Housing Act 2004. However, the process of licensing HMOs is controlled at a strictly local level, with each local authority setting its own licensing requirements and fees, which can vary significantly around the country.

In order to get an HMO licence for your property, you’ll need to apply through the local authority where your property sits and, depending on your local council, the process can take up to 12 weeks.

How much does an HMO licence cost?

In England and Wales, the cost of an HMO licence depends entirely on where your property is located, as each local authority sets its own rates.

The HMO Hub network provides helpful guidance on the varying costs of HMO licences across England, showing the significant differences in price for five-year licences in different councils.

  • East Cambridgeshire District Council have the lowest five-year fee, at £300
  • Bristol City Council have the highest five-year fee, at £1,420

HMO licence fees in Northern Ireland

Regardless of which local authority your property is in, all HMOs in Northern Ireland are licensed through Belfast City Council. They charge £37 per occupant, per year, meaning a five-year licence for an HMO in Northern Ireland would cost £185 per person.

HMO licence fees in Scotland

In Scotland, much like in England and Wales, the cost of an HMO licence varies according to the local authority, with each local council charging varying rates for different lengths of licence and for HMOs of various occupancy. For example:

  • In Edinburgh, a one-year HMO licence for an HMO of up to 3 people costs £253 while for a five-person HMO, the cost is £689
  • In Glasgow, where one-year licences are not granted, a three-year licence for up to 10 occupants costs £2,180
  • In Aberdeen, a three-year licence for up to five people costs £735.25

Penalties for letting out an HMO without the correct licence

Letting out a property classed as an HMO without having the proper licence in place is a serious offence and can lead to significant fines.

In Scotland, you could be fined up to £50,000 for letting out an HMO without the correct licence, while in Northern Ireland the penalty is £5,000, or £20,000 if the issue goes to court. In England and Wales, failure to have an HMO licence can lead to an unlimited fine.

HMO licensing and student houses

A question many current or prospective landlords may ask is ‘do I need an HMO licence to let out a house to students?’ The answer is that in most cases, you will need an HMO licence for student properties. This is because the majority of student lets are house shares involving multiple tenants who are not from the same household (family or couple)

It makes no difference for the purposes of licensing whether a student property is let under a single, joint tenancy agreement that all the student occupants sign or a separate agreement for each tenant.

HMO licences and landlords’ insurance

While many insurers will not offer landlords’ insurance for properties that are classed as HMOs, Superscript is able to cover houses in multiple occupation with up to five tenants from two or more households.

With more tenants from different households and potentially more separate tenancy agreements, HMOs can present greater risks for landlords regarding issues like accidental or malicious damage to the building or contents.

While we can cover HMOs and help give you peace of mind as the owner of a house-share property, one of the important conditions that you must meet to get landlord’s insurance is that you have an HMO licence in place, if applicable in your local authority area.

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