Sharing a house with several other tenants who aren’t your family usually puts the property into a legal category with its own rules: a House in Multiple Occupation, or HMO. Whether a licence is actually required depends on how many people live there and how the council in that area has set its local rules — and getting it wrong carries real legal and financial consequences for a landlord.
When mandatory licensing applies
GOV.UK guidance sets out the national mandatory scheme: a property needs a licence from the local council if it’s a “large” HMO, defined as a home shared by five or more tenants forming more than one household, where some or all tenants share toilet, bathroom or kitchen facilities. A household generally means a single person or people who are related or in a relationship living together — so five friends sharing a house, none of whom are related, would typically count as five separate households and trigger mandatory licensing.
Why licensing can apply below the five-tenant threshold too
The mandatory national scheme is only the floor. Many councils run additional licensing schemes covering smaller HMOs in their area — commonly properties shared by three or four tenants forming two or more households — and some run selective licensing schemes covering all private rented properties in a defined area, regardless of HMO status, usually in response to local issues with housing standards or anti-social behaviour. Because these local schemes vary so much by council, the safest approach for both landlords and tenants is to check directly with the relevant council’s private renting or housing team rather than assuming the national five-tenant rule is the whole picture.
What a council actually checks before granting a licence
Before granting an HMO licence, the council assesses whether the landlord (or their appointed manager) is a “fit and proper person,” whether the property is suitable for the number of people the licence would permit — covering things like room sizes, number of amenities, and fire safety provisions — and whether management of the property is otherwise adequate, including up-to-date gas safety checks and prompt repairs. A standard licence typically lasts up to five years, and GOV.UK guidance confirms a licence cannot be transferred to a new landlord if the property changes hands — a new owner has to apply afresh, it doesn’t carry over automatically.
What happens if a landlord doesn’t have a licence that’s legally required
Operating an HMO that legally requires a licence, without holding one, is a criminal offence, and councils have several enforcement routes: refusing or revoking a licence, prosecuting the landlord, or imposing a civil penalty. For tenants specifically, GOV.UK guidance confirms a significant remedy exists separately from council enforcement — tenants can apply to the First-tier Tribunal for a rent repayment order, which can require the landlord to repay up to twelve months of rent paid while the property was operating as an unlicensed HMO.
Checking whether your home needs, or has, a licence
Shelter’s guidance for tenants notes that even where a licence isn’t held, the standard landlord obligations around gas safety, electrical safety and repair still apply regardless of licensing status — an unlicensed HMO doesn’t mean an unregulated one on those specific points. To check whether a particular property should be licensed, or whether it already is, both GOV.UK and Shelter point tenants and landlords to the relevant local council’s private renting or housing team, since councils generally maintain a register of licensed HMOs in their area.
FAQs
Does a licence guarantee the property meets modern safety standards?
A licence reflects the standards checked at the time it was granted and renewed, not a permanent guarantee — tenants should still report disrepair or safety issues directly to the landlord and, if unresolved, to the council.
Can a tenant apply for a rent repayment order without moving out first?
Yes, a rent repayment order application doesn’t require the tenant to have left the property, though tenants often bring these claims after a tenancy has ended.
Do student houses count as HMOs?
Often, yes — a shared student house meeting the tenant-number and household criteria is generally treated the same as any other HMO for licensing purposes, though some councils apply specific exemptions in defined circumstances.
Bottom line
HMO licensing exists to keep shared housing safe and properly managed, and the rules are more layered than a single national threshold — local council schemes can bring smaller properties into scope. Tenants in an unlicensed property that should be licensed have a real financial remedy through a rent repayment order, not just a complaint to make.