If you own or manage a House in Multiple Occupation (HMO), you may be required to hold an Additional HMO Licence, even if your property does not fall under the Mandatory HMO Licensing scheme. Understanding whether this applies to your property is essential, as operating an unlicensed HMO carries significant legal and financial risks.
What Is an Additional HMO Licence?
Additional HMO Licensing is a local authority scheme, not a nationwide requirement. Councils have the power, under Part II of the Housing Act 2004, to introduce additional licensing in specific areas where they believe rented properties are not being adequately managed.
These schemes are commonly introduced in areas that have experienced a shift from family housing to shared accommodation, particularly in major towns and cities. In some cases, licensing may apply only to certain streets or postcodes within a borough.
Local authorities may also introduce Selective Licensing, which can apply to all privately rented properties in a designated area, not just HMOs.
Do I Need an Additional HMO Licence?
While requirements vary by council, you will typically need an Additional HMO Licence if:
- Your property is an HMO occupied by three or four tenants forming more than one household
- Your local authority has introduced an Additional Licensing scheme covering your area
However, there are specific exemptions, including:
- The property is subject to an Interim or Final Management Order under Part 4 of the Housing Act 2004
- A Temporary Exemption Notice has been granted
- Certain student halls of residence
- The property is managed by a local authority, registered social landlord, police, fire and rescue authority, or a health service body
- The property is used by a religious community
- The property is occupied by only two people forming two households, or is owner-occupied with no more than two lodgers
Additional HMO Licensing schemes currently operate in over one third of London boroughs, and councils may apply the rules differently. It is strongly recommended that landlords check their local authority website or contact the council directly to confirm whether their property is affected.
How to Apply for an Additional HMO Licence
Applications are usually made through your local authority website. As part of the process, you will typically be required to provide documentation such as:
- Gas Safety Certificate
- Electrical Installation Condition Report (EICR)
- Fire Risk Assessment
- Automatic Fire Detection Certificate
- Emergency Lighting Certificate
- Floor plans
- Property insurance details
- PAT testing records
- Tenancy or management agreements
- Accreditation membership (where applicable)
- Land Registry title (dated within 28 days of application)
- Asbestos survey
Under the Housing Act 2004, you must also notify all relevant persons that you are applying for a licence. This includes freeholders, leaseholders, mortgage lenders, managing agents, and any other parties with an interest in the property. Their details must be supplied to the council as part of your application.
What Happens If You Do Not License Your HMO?
Operating a licensable HMO without the required licence is a serious offence. If you fail to comply, the consequences may include:
- Prosecution with unlimited fines, or
- A civil penalty of up to £30,000 per offence
In addition:
- Tenants or the council may apply for a Rent Repayment Order, reclaiming up to 12 months of rent
- You may be prevented from serving a Section 21 notice while the property remains unlicensed
- The council may take control of the property under an Interim Management Order
A Hassle-Free Alternative for HMO Landlords
Managing HMO licensing, compliance, and ongoing maintenance can be complex and time-consuming. Joining a Guaranteed Rent Scheme, such as the one offered by us, allows you to transfer this responsibility entirely.
We manage the property, ensure compliance with licensing and safety requirements, and guarantee your rent is paid every month, providing financial security without the operational burden.
If you own an HMO and want a compliant, stress-free solution with fixed rental income, contact us today to find out how our Guaranteed Rent Scheme can work for you.
