What is a HMO?
There are 3 categories all of which are subject to
the Rent Repayment Order legislation. In other words you can get your
rent back if they are any/all of the below:
· Manadatory HMO: defined in the Housing & Planning Act 2004 as a property with 5 or more tenants forming more than 1 household sharing facilities such as kitchen bathroom and/or toilets over 3 or more floors. A household is a family group, eg married couple, father and step-daughter etc. It follows that if everyone is related then there is only 1 household so it is not an HMO. Worth noting that the 3 floors may include ground floor commercial premises which are not occupied by residential tenants. So a maisonette of 2 floors above a shop would meet the 3 floor requirement
****STOP PRESS***** From 01/10/2018, under the Prescribed Description Order 2018, the "3 or more floors" requirement was removed. From this date all properties shared by 5 or more tenants who are not all from the same household are HMOs that fall under mandatory licensing requirements. Purpose-built flats in blocks with 3 or more such flats are exempt: crazy but that's the rule
· Additional Scheme HMO: A Local Authority (LA) has the power to introduce Additional Licensing schemes with less strict conditions for qualification, eg in Hammersmith & Fulham just 3 unrelated people in a flat on 1 floor is an HMO, ditto Camden. See here for more details: https://www.londonpropertylicensing.co.uk/ then select borough…landlord service that has done the work for us- sweet!
HMO: LA designated areas/streets within the borough where licensing is
required- see also above link for London
Sharing: Basically the idea is that HMOs are occupied by more than 1 household but don't have enough basic facilities for those households to function independently. In other words they have to share 1 or more of some basic amenities defined as toilet, personal washing facilities or cooking facilities. Only 2 households need to share one of these facilities for the whole property to be considered a HMO. In another wrinlkle related to shared amenities: if none of the households share any of the basic facilities provided but 1 of the basic facilities is missing (eg bathroom) then the property is still considered a HMO.
Briefly mentioned above (also in our FAQ), the Housing Act 2004 defines single houshold more carefully see the details in the Act, especially section 258 on p. 201 in the linked document. Briefly: people can be considered together as a single household if they are related: whole-blood or half-blood, foster, step-parent/child, in-laws (and equivalent for unmarried couples), a married couple or unmarried but "living as..." (same-sex or different-sex couples).
2 more wrinkles here:
Any purpose built flat that is in a block comprising 3 or more self-contained flats is not covered by the Prescribed Description Order 2018. In other words: it is not a mandatory HMO as described above and does not require licensing under the 2016 Housing & Planning Act. It may, of course, fall under a Local Authority's Additional or Selective scheme however.
section 257 HMOs are exempt: This is a classification of HMOs to take in a special kind of flat, nearly always in a converted house. Obviously they're not purpose-built but they are self-contained, in this definition. In addition, less than 2/3 of the flats in the converted block should be owner-occupied and the conversion infringed and infringes building regulations. If such a flat has 5 or more tenants from more than 1 household however it would be classified as a mandatory HMO, as it is not, by the above definition, purpose-built.
For the full low-down on HMO definition (post 1/10/2018) please see: Houses in Multiple Occupation and residential property licensing reform