HMO Compliance Guide 2026: Licensing, Safety & Penalties

Houses in Multiple Occupation (HMOs) generate higher rental yields than single-lets, but they also carry heavier regulatory burdens. Get compliance wrong and you're looking at fines up to £30,000, rent repayment orders, and potential banning orders that stop you operating as a landlord entirely.

This guide covers everything you need to know about HMO compliance in 2026, including recent changes from the Renters' Rights Act and evolving enforcement approaches across London boroughs.

What Counts as an HMO?

The statutory definition is a property rented out by at least three people who are not from one household, sharing toilet, bathroom, or kitchen facilities.

But this basic definition splits into categories with different rules:

Small HMO: 3-4 unrelated tenants sharing. Licensing depends on the borough.

Large HMO (licensable HMO): 5+ unrelated tenants sharing. Mandatory licensing applies nationwide.

Section 257 HMO: Buildings converted into flats before 1991 that don't meet Building Regulations 1991 standards, where less than two-thirds are owner-occupied.

Understanding which category your property falls into determines your licensing obligations.

The Three Types of HMO Licensing

1. Mandatory Licensing

Applies to all England HMOs with:

5 or more tenants
Forming more than one household
Sharing amenities

What you need:

Valid HMO licence from the local council
Licence holder (usually landlord or agent) deemed "fit and proper"
Compliance with licence conditions including room sizes, amenities, and management standards

Licence duration: Maximum 5 years, then renewal required

Cost: Varies dramatically by borough—£500 to £1,500+ for 5 years

2. Additional Licensing

Councils can extend licensing to smaller HMOs (typically 3-4 tenants) in specific areas or borough-wide. This requires public consultation and government approval.

Boroughs with additional licensing schemes (2026):

Camden (borough-wide, 3+ tenants)
Croydon (selective wards, 3+ tenants)
Greenwich (borough-wide, 3+ tenants)
Hackney (selective wards, 3+ tenants)
Hammersmith & Fulham (borough-wide, 3+ tenants)
Islington (borough-wide, 3+ tenants)
Lambeth (borough-wide, 3+ tenants)
Newham (borough-wide, all private rentals with 3+ tenants)
Southwark (selective wards, 3+ tenants)
Waltham Forest (borough-wide, 3+ tenants)
Wandsworth (selective wards, 3+ tenants)

This list changes as schemes renew or new ones are introduced. Always check current status with your council.

3. Selective Licensing

Covers all private rented properties in designated areas, not just HMOs. Introduced to tackle anti-social behaviour and poor property conditions.

Current selective licensing boroughs include:

Brent (certain wards)
Croydon (certain wards)
Ealing (certain wards)
Harrow (certain wards)
Kingston upon Thames (borough-wide)
Newham (borough-wide)
Redbridge (borough-wide)
Tower Hamlets (certain wards)

Selective licensing operates alongside HMO licensing—you may need both.

Room Size Requirements

Since October 2018, mandatory HMO licences include minimum room sizes:

| Room Type | Minimum Floor Area | Notes | |-----------|-------------------|-------| | Single bedroom (one person over 10) | 6.51m² | Measured at 1.5m+ ceiling height | | Double bedroom (two people over 10) | 10.22m² | Measured at 1.5m+ ceiling height | | Child under 10 | 4.64m² | Measured at 1.5m+ ceiling height |

Key points:

Sloping ceilings: Only count floor area where ceiling height exceeds 1.5m
Built-in storage: Generally excluded from floor area calculations
Enforcement: Councils measure during licence inspections. Undersized rooms = licence refusal or conditions
Existing tenants: Some councils allow phased compliance if tenants were in place before rules changed

Fire Safety for HMOs

HMOs face stricter fire safety requirements than single-lets. The LACORS "Housing - Fire Safety" guidance is the bible here.

Detection and Alarm Systems

Minimum standard for small HMOs (3-4 tenants):

Mains-powered smoke alarms on every floor
Interlinked alarms (one triggers all)
Heat alarm in kitchen
Battery backup for power cuts

Large HMOs (5+ tenants) typically need:

Grade A or Grade D fire detection systems
Professional design and installation
Annual servicing and certification

Fire Doors

Required on:

Kitchens
Living rooms (in risk situations)
Bedrooms
Any room opening onto an escape route

Specifications:

FD30 (30-minute fire resistance) minimum
Self-closing devices that actually work
Intumescent strips and smoke seals
No damage, holes, or unauthorised modifications

Escape Routes

Clear, unobstructed paths to final exit
Emergency lighting if natural light inadequate
Fire-resisting construction between escape routes and risk rooms
Final exit doors easy to open without keys

Fire Risk Assessment

Every HMO needs a written fire risk assessment. For larger HMOs, this should be conducted by someone competent—typically a fire safety professional, not a general handyman.

BoroughReady connects you with qualified fire risk assessors who understand HMO requirements.

Amenities Standards

HMO licences specify minimum facilities based on tenant numbers:

Kitchens

| Number of Tenants | Minimum Cooking Facilities | Minimum Fridge/Freezer | |-------------------|---------------------------|----------------------| | 1-4 | 4-ring cooker, oven, grill | 1 fridge, 1 freezer (or 1 fridge-freezer) | | 5-6 | As above, plus additional facilities or larger appliances | Additional fridge or fridge-freezer | | 7-10 | Professional assessment required | Significant additional capacity |

Bathrooms

Adequate hot and cold water
Shower or bath for every 5 tenants (recommendation, not always strict rule)
Separate WCs if bathroom shared by more than 4
Ventilation and heating

Space Standards

Beyond bedroom sizes, councils consider:

Living room provision (not always mandatory for small HMOs)
Storage space
Dining facilities
Outdoor space

Management Regulations

The Management of Houses in Multiple Occupation (England) Regulations 2006 impose duties regardless of licensing status:

Landlord Responsibilities

Provide contact details to tenants
Maintain fire safety measures
Ensure common areas safe and clean
Maintain water supply and drainage
Supply and maintain gas/electricity (if included in rent)
Keep common areas in good repair

Tenant Responsibilities

Avoid damaging fire safety equipment
Keep escape routes clear
Store rubbish properly
Allow landlord access for repairs
Behave responsibly to avoid nuisance

The Renters' Rights Act: What's Changed

The Renters' Rights Act 2024 (fully implemented by 2025-2026) introduces significant changes affecting HMOs:

Abolition of Section 21

No-fault evictions are ending. All evictions require specific grounds. For HMOs, this means:

Anti-social behaviour: Stronger grounds for eviction
Landlord moving in: Requires 6 months notice, landlord must occupy for 12 months minimum
Rent arrears: Streamlined process but stricter evidence requirements

Periodic Tenancies by Default

Fixed terms are replaced with rolling periodic tenancies. Tenants can leave with 2 months' notice. Landlords need valid grounds to end tenancies.

Decent Homes Standard

New minimum property condition requirements. Properties must be:

Free from serious hazards (Category 1 under HHSRS)
In a reasonable state of repair
Have reasonably modern facilities
Provide thermal comfort (effective insulation and heating)

Pet Requests

Tenants can request permission to keep pets. Landlords can require pet insurance but cannot unreasonably refuse.

Property Portal and Ombudsman

All private landlords must join a redress scheme. A new property portal will track compliance and landlord registration.

Penalties for Non-Compliance

The financial consequences of HMO violations are severe and increasing.

Operating Without a Licence

Civil penalty: Up to £30,000 per offence
Criminal prosecution: Unlimited fine
Rent repayment orders: Tenants can claim back up to 12 months' rent
Banning orders: Prohibition from letting property or acting as an agent

Breaching Licence Conditions

Civil penalty: Up to £5,000 per breach
Licence revocation: Council can revoke and refuse future applications
Management orders: Council takes control of the property

Housing Health and Safety Rating System (HHSRS)

Councils can take action for Category 1 hazards (serious risk) and Category 2 hazards (less serious):

Improvement notices
Prohibition orders (preventing occupation)
Emergency remedial action
Demolition orders (extreme cases)

Real-World Penalty Examples

Camden Council, 2023: £30,000 fine for operating unlicensed HMO
Newham Council, 2024: £25,000 civil penalty plus rent repayment order of £18,000
Croydon Council, 2024: Landlord banned from letting for 5 years after repeated HMO violations

The HMO Compliance Checklist

Before letting:

[ ] Confirm whether your property needs a licence
[ ] Apply for licence at least 2 months before letting
[ ] Complete fire risk assessment
[ ] Install required fire safety measures
[ ] Ensure all rooms meet size requirements
[ ] Verify amenities meet standards for tenant numbers
[ ] EICR completed (within 5 years, satisfactory)
[ ] Gas Safety Certificate (current)

Ongoing:

[ ] Annual gas safety checks
[ ] 5-year EICR renewal
[ ] Annual fire risk assessment review
[ ] Maintain fire safety equipment
[ ] Respond to repairs promptly
[ ] Licence renewal before expiry
[ ] Keep tenant contact details updated

Download borough-specific compliance packs for detailed requirements in your area.

The Bottom Line

HMOs can be profitable, but they're not passive investments. The regulatory burden is substantial and enforcement is increasingly aggressive.

Success requires:

Understanding exactly which licensing applies to your property
Meeting room size and amenities standards from day one
Investing in fire safety (detection, doors, alarms)
Maintaining certifications and renewing on schedule
Keeping detailed records of compliance

The cost of getting it wrong—£30,000 fines, rent repayment orders, banning orders—far exceeds the cost of doing it right.

BoroughReady helps landlords navigate HMO compliance with borough-specific guidance and verified professional connections.

Last updated: February 2026. HMO regulations change frequently. Always verify current requirements with your local council.