HMO Requirements: The Ultimate Guide to Houses of Multiple Occupation

If you’re pondering what to do with a buy-to-let property in Redbridge or Ilford, letting it as a house in multiple occupation (HMO) has its benefits. Rental yields are likely to be higher than with standard buy-to-let, and the risk of non-payment is reduced as each of your tenants pays for their room separately. 

However, HMO requirements and rules are a little more complicated than the ones for standard buy-to-let, so it is essential to understand your responsibilities as an HMO landlord before deciding if it is the right option. For example, you may need to apply for an HMO licence, and there are additional requirements around fire safety. You may not have considered costs, such as council tax and insurance. 

To help you navigate the complexities of landlord responsibilities for HMOs, we have compiled a guide to HMO requirements, detailing everything you need to know. 

What Is An HMO? 

HMO stands for house in multiple occupation. A property is classed as an HMO if at least three tenants live there, forming more than one household AND toilet, bathroom or kitchen facilities are shared. 

A household is defined as either a single person or members of the same family, including people who are married or living together. 

Pros And Cons Of HMOs 

If you’re wondering whether to rent out your property as an HMO or stick with standard buy-to-let, you need to weigh up the pros and cons for HMO landlords: 

Pros Of HMOs: 

• Higher income: HMOs can generate significantly higher rental income compared to single-let properties because you can charge rent per room rather than for the whole property. This setup tends to yield better cash flow and can be especially lucrative if located in high-demand areas like university towns or major cities. 

• Less risk from arrears: With multiple tenants, the financial risk is spread out. If one tenant fails to pay rent, the loss is partially absorbed by payments from other tenants, maintaining a more stable income flow. 

• Consistent demand: HMOs often attract a wide range of tenants, from students to young professionals, especially in urban areas or near educational institutions, ensuring a consistent demand. 

• Better ‘economy’ of scale’: Managing one property with several tenants can be more cost-effective than managing multiple single-let properties. Shared facilities mean reduced costs for utilities and amenities compared to multiple separate properties. 

• Opportunity for capital growth: Older buildings typically used for HMOs in central urban locations may offer more potential for capital appreciation compared to newer builds on the outskirts. 

• Easier evictions (potentially): It is easier to evict a tenant – if you live in the HMO property with them. 

• Inspections are easier: Rather than inspecting multiple single-let properties, you can arrange to do an inspection for the full property at the same time. 

Cons Of HMOs: 

• Higher tenant turnover: Managing HMOs often involves dealing with a higher rate of tenant turnover, particularly with student tenants, which can lead to frequent void periods and re-marketing costs. 

• More active management needed: HMOs require more active management. The complexity of dealing with multiple tenants, potentially high maintenance costs, and resolving disputes can demand more time and resources. 

• Tougher regulations: HMOs are subject to stringent regulations, including mandatory licensing, which can vary significantly by location. Compliance with health and safety, and fire regulations necessitates regular checks and can lead to hefty penalties if HMO standards are not met. 

• Higher initial & running costs: Setting up an HMO can be costly due to the need for specific structural modifications like fire doors and additional bathrooms. Ongoing costs are also higher due to increased wear and tear and the need to manage common areas. 

• Harder to finance & insure: Obtaining mortgages for HMOs can be more challenging than for single-let properties. Lenders often require landlords to have more experience, and insurance premiums can be higher due to perceived increased risks. 

• Increased responsibility for landlords: HMO landlords are usually responsible for bills and council tax. 

• (For further information on the pros and cons, you can look here, here and here.) 

What Are The HMO Licensing Rules?

Following the Housing Act 2004, local authority licensing was introduced for some HMOs in England and Wales. There are two types of HMO licence: 

1 Mandatory Licences 

The 3 or 4 bed HMO requirements differ from 5 bed HMO requirements. Properties with 3 or 4 tenants, where one or more occupants are not related, do not require a mandatory HMO licence but a 5 bedroom with 5 or more occupants where one or more is not related, will require a mandatory HMO licence. 

You will need to obtain a mandatory licence if your property: 

• houses five or more people from two or more households 
• has shared amenities such a kitchen, bathroom or toilet 

2 Additional Licences 

Local authorities introduce these licences and cover the whole or part of their council area. In the London Borough of Redbridge, all HMOs need an additional licence. 

The London Borough of Havering also operates an additional licensing scheme, which currently costs £900 in total for the licence fee without accreditation, or £865 with accreditation. 

Hackney Council had an additional licensing scheme but ended the scheme in September 2023, along with their selective licensing scheme. 

Newham launched a selective licensing scheme in June 2023 for rental properties that are not mandatory or additional HMOs, which applies across the borough with the exception of Stratford Olympic Park and Royal Victoria wards. The selective licenses cost £750 but discounts are applied for landlords with accreditation and properties with high energy efficiency ratings. 

Additional HMO licenses are required for HMOs shared by three or four people forming two or more households. The total cost for an additional HMO license is £1,250. 

Waltham Forest also has selective licence and additional licence schemes. The selective licensing scheme was introduced in May 2025 which covers all rental properties across the borough with the exception of Hatch Lane, Highams Park North and Endlebury. The cost is £895 for the licence fee. 

The additional licensing scheme for Waltham Forest covers properties occupied by three or more people outside of mandatory HMO licensing and the licence fee is £1,200. 

Before you decide whether to invest in an HMO, you should check all of the different HMO requirements and licences you may need to apply for. 

What About Unlicenced HMO Requirements? 

Some smaller HMOs do not require licences, which for most councils is up to four tenants from two or more households. However, there are still requirements to comply with Fire Safety Regulations and the HHSRS. The landlord must also be compliant with the Management of Houses in Multiple Occupation Regulations (2006). 

Unlicenced HMOs may still require an additional HMO licence, which you can check with your local authority. 

HMO Rules And Requirements 

If you are already a landlord of buy-to-let properties, all of the landlord responsibilities you are familiar with still apply. You will also have additional requirements on top of these as an HMO landlord. 

HMO Minimum Room Sizes 

There are licence conditions regarding minimum bedroom sizes in a house of multiple occupancy. Sleeping accommodation room size requirements are: 

• 6.51 square metres for a person aged 10 or over 
• 10.22 square metres for 2 people aged 10 or over 
• 4.64 square metres for a child under 10 years old 

HMO Kitchen Requirements 

There are also minimum kitchen sizes, depending on the number of occupants living in the HMO: 

• 5 or less occupants – 7m2 
• 6 or 7 occupants – 8m2 
• 8 or 9 occupants – 9m2 
• 10 occupants – 10m2 

A communal living room is required to have at least 13 square meters for HMOs with three people, plus an additional one square meter for every additional occupant. 

The are also requirements of the kitchen equipment and appliances that must be supplied in HMOs. For every five occupants, the landlord must provide: 

• 1 cooker 
• 1 standard-sized fridge 
• 1 sink 

HMO Amenities 

Your HMO must meet specific standards covering amenities such as heating, washing facilities, kitchens and bathrooms. For example, kitchens must be of adequate size for the number of tenants. There are also rules for bathroom facilities, including being fitted with suitable and functioning locks, and shared bathrooms and WCs must be accessible from a common area. 

Read more about amenity standards in Redbridge here. 

HMO Fire Safety Regulations 

Houses of multiple occupation are regarded as having a higher fire risk than single-let properties, so comprehensive fire safety requirements are in place to protect tenants. The measures of fire safety that you will need to take depends on how many people live in the property and whether there are any vulnerable tenants. 

• Fire regulations for different building heights – 2 storey HMO fire alarm requirements are slightly different than for 3 storeys or more. For one and two storey HMOs, a Grade D LD3 alarm is generally required, whereas properties with three stories or more require a Grade A system to cover communal areas as well as an LD3 system for tenant’s dwellings. 
• Alarms – Fire safety rules include that HMOs must have working smoke detectors, fire doors and a fire blanket in the kitchen. It is best practice to complete a Fire Risk Assessment, even if this is not mandatory by the local authority. Smoke alarms must be tested on a regular basis. 
• Fire extinguishers – While there are no HMO fire extinguisher requirements by law, if a risk assessment determines that they are required, they should be available in the areas requested. 
• Doors – There are also specific HMO door lock requirements, including that any doors that are part of an escape route allow keyless escape, to ensure occupants can safely exit the building in an emergency. 
• Windows – You should also check the HMO window requirements of your local authority, as most will require each room has an openable window and a minimum size of window based on the size of the floor area. For example, some councils require windows to be at least 1/10th of the floor area. 

HMO Electrical Safety Regulations 

An HMO landlord must obtain an Electrical Installation Condition Report (EICR), which a qualified electrician must complete. The electrical system should be checked at least every five years to ensure electrical installations are safe and present no fire hazards. The landlord must provide evidence that the electrical safety checks have been completed to obtain an HMO licence. 

HMO Emergency Lighting Requirements 

For HMOs with 5 or more occupants, there are mandatory emergency lighting requirements. The property must have emergency lighting installed in communal areas including corridors, stairways, shared living spaces and shared kitchens. The landlord is required to keep an installation certificate to evidence that a qualified professional installed the emergency lighting. Maintenance and testing logs should also be kept, to comply with regulations. 

HMO Gas Safety Regulations 

A Gas Safe Registered Engineer must complete annual Gas Safety Checks to comply with the Gas Safety Regulations 1998. This involves the inspection of gas appliances, pipework and flues, and local authorities will often request a copy of the current Gas Safety Certificate before approving an HMO licence. 

Other Considerations 

As well as the HMO requirements listed above, there are some additional considerations to think about before you decide whether becoming an HMO landlord is the right option for you: 

What do HMO Tenancy Agreements Look Like?

Most tenants in an HMO have an assured shorthold tenancy (AST) – either one AST for the group who will all sign or individual room ASTs. 

If you live at the property, you may have an Excluded Tenancy Agreement, otherwise known as a Lodger’s Agreement. This means you don’t need a court order to evict a tenant but would need to give reasonable notice of four weeks. 

What Are HMO Planning Permission Rules?

You shouldn’t need planning permission to convert a family home (known as a C3 dwelling) into an HMO (C4) unless there will be six or more occupants (this number can vary depending on the local authority). 

If there will be more occupants than the council allows without planning permission, this is known as ‘Sui Generis’, and you will require planning permission from your local authority. In any case, it is worth checking. 

When you submit your planning permission application, the local authority will review the application based on a number of factors, such as: 

• Whether there are adequate amenities and parking spaces. 
• Whether there are already enough HMOs in the area. 
• The area has good employment and education connections. 

If planning permission is granted, the property would also need to meet the council’s HMO licence requirements. 

How Do HMO Council Tax And Utility Bills Work?

HMO landlords who let individual rooms are responsible for paying council tax. If you let the whole property to a group, they will be jointly responsible for the council tax, unless exempt – for example, students. 

The same applies to utilities. If you let the property room by room, paying the utility bills and including the cost in the rent is probably simpler. 

Mortgages For HMO Properties 

If you need to take out a loan to fund your property purchase, you will need a specific HMO mortgage product – a standard buy-to-let mortgage will not permit the home to be let under multiple tenancies. You must consult your lender if you are considering changing your buy-to-let property to an HMO. 

What HMO Insurance Do I Need?

Specialist insurance products are available, which are designed for HMO landlords. This type of insurance isn’t mandatory, though you will need cover for buildings and contents and should consider public liability insurance. 

Frequently Asked Questions 

Looking for an HMO property management service?

While managing an HMO yourself will involve more admin and research, it isn’t as daunting as you may think. To make things easier, choose a letting agent with experience in HMOs in areas such as Newbury Park and Grays. If you would like more advice about managing an HMO, contact us today.

Looking for a stress-free lettings solution for your HMO? Then explore our guaranteed rent services in Tower Hamlets, Greenwich, Lewisham, Southwark, Bromley & beyond.