Definition of HMO

The Housing Act 2004 clarifies the definition of a house in multiple occupation (HMO). The definition of an HMO is found in Part 7 of the 2004 Act [1].

To be defined as an HMO, a building, or part of a building, must fall within one of the following categories:

  • a building or flat in which more than one household shares a basic amenity, such as bathroom, toilet or cooking facilities: this is known as the ‘standard test’ or the ‘self-contained flat test’
  • a building that has been converted and does not entirely comprise of self-contained flats: this is known as the ‘converted building test’
  • a building that is declared an HMO by the local authority
  • a converted block of flats where the standard of the conversion does not meet the relevant building standards and fewer than two-thirds of the flats are owner-occupied: this is known as a section 257 HMO.

These tests are explained in detail below.

Standard test

A building is an HMO under the standard test if [2]:

  • the occupants share one or more of the basic amenities (defined as a toilet, personal washing facilities and cooking facilities) or the accommodation lacks one or more of these amenities
  • the building does not entirely consist of self-contained flats (it may, however, comprise some self-contained units)
  • the building is occupied by at least three people who constitute more than one household
  • the building is the occupants’ main residence (or should be treated as such)
  • this occupation constitutes the only use of the accommodation, and
  • rents are payable, or some other form of consideration, for at least one person’s occupation.This test applies to the most common type of HMO. It applies to ‘shared houses’ and purpose-built bed-sit accommodation and may apply to a hostel if the accommodation does not entirely comprise of self-contained units.

Self-contained flat test

The criteria to meet the self-contained flat test are the same as the standard test, except that they apply to an individual flat that is in multiple occupation.[3]

A unit of accommodation is self contained if [4]:

  • it is a separate set of premises, and
  • all three basic amenities are available for the exclusive use of its occupants.

If a building comprises both self-contained and non-self-contained accommodation and there is some sharing of facilities, then the standard test applies.

Converted building test

The converted building test is met where [5]:

  • a building or part of a building consists of living accommodation and has been converted, ie one or more of the units of accommodation have been created since the building was originally constructed
  • it contains at least one unit of accommodation that is not a self-contained flat (there may be some self-contained flats)
  • the accommodation is occupied by three or more persons who do not form a single household
  • the accommodation is the occupants’ main or only residence (or should be treated as such)
  • occupation as living accommodation constitutes the only use of that accommodation
  • rents are payable.

This test would apply, for example, in the case of a house converted to bedsits, where bathrooms are shared.

HMO declarations

The local authority can make a declaration that a house is in multiple occupation where it is satisfied that the premises meets one of the three tests above and the occupation of the living accommodation (by more than one household) constitutes a ‘significant use’,[6] rather than ‘sole use’, of the property [7].

The local authority must serve a notice that the building has been declared an HMO on each relevant person (any person with an interest in the building, or who manages or has control of the building, but not a tenant) within seven days of making the decision [8]. The notice comes into force after 28 days, which is the period for appeal to the First-tier Tribunal (Property Chamber) [9]. If there is an appeal, the notice only comes into effect once it has been confirmed by the Tribunal and the time for appeal against that decision has elapsed (normally 28 days) or the Upper Tribunal confirms the notice.

The local authority may revoke the declaration at any time on its own initiative or on application by a relevant person, where the building no longer meets any of the HMO tests. If the local authority refuses an application to revoke an HMO declaration, this decision can be appealed to the First-tier Tribunal (Property Chamber) within 28 days.

Section 257 HMOs

Where a building or part of a building has been converted into, and consists wholly of, self-contained flats, it will be an HMO if [10]:

  • the standard of the conversion does not meet that required by the Building Regulations 1991 or 2000 (whichever were in force at the time of the conversion), and
  • fewer than two-thirds of the flats are owner-occupied. Owner-occupiers are those with a lease of more than 21 years or who own the freehold in the converted block of flats, or a member of the household of the person who is the owner.

Definition of a single household

A building is considered an HMO if it is occupied by more than one household. The Housing Act 2004 defines a single household as [11]:

  • a family, eg a couple (whether married or not and including same-sex couples) or persons related to one another
  • an employer and certain specified domestic employees
  • a carer and the person receiving care
  • a foster parent and foster child.

Only or main residence

To be an HMO the accommodation has to be used by persons as their only or main residence. It will usually be apparent whether or not this is the case, but secondary legislation specifies certain situations where the nature of occupation is less clear cut. These include [12]:

  • a residence for the purpose of undertaking full-time further or higher education
  • a refuge, ie a building or part of a building used by a voluntary organisation for temporary accommodation for people who have left their home as the result of domestic violence
  • occupation by migrant or seasonal workers where the employer or agent provides the accommodation
  • occupation by asylum seekers and their dependents, where the accommodation has been provided under section 95 of the Immigration and Asylum Act 1999 and the accommodation is provided by a private landlord under contract to or on behalf of UK Border Agency asylum support.

A hostel or night shelter providing accommodation to homeless people may be an HMO because, even if the accommodation is overnight, it will be the occupants’ only residence. However, rent (or consideration) must be paid for the HMO definition to apply.

  • Exemption from HMO regulations

Certain buildings that meet the criteria to be defined as an HMO under the Housing Act 2004 are exempt from the licensing requirements and the management regulations. This buildings that are exempt are [13]:

  • managed or controlled by private registered providers of social housing, a co-operative society, local authorities and other specified public sector bodies
  • buildings regulated under other legislation, e.g. boarding schools, prisons, accommodation centres for asylum seekers and care homes
  • occupied by religious communities, unless they are section 257 HMO’s (see above)
  • halls of residence (or other accommodation occupied by students) that are managed or controlled by one of the educational establishments listed in the regulations
  • only occupied by an owner/occupier, members of their household and no more than two tenants or licensees. This exemption does not apply to section 257 HMOs (see above)
  • only occupied by two people who form two households (as defined above).

Definition for purposes of council tax liability

The Council Tax (Liability for Owners) Regulations 1992, which provide that the owner of an HMO is liable to pay council tax rather than the occupiers, contain a different definition of a HMO. Under the regulations, an HMO is a dwelling which:

  • was originally constructed or converted for occupation by people constituting more than one household
  • is occupied by two or more people each of whom is a tenant or has a licence to occupy, whether or not they are liable to pay rent.

On the basis of this definition, it has been held that joint tenants who were not related but had exclusive possession of the whole dwelling under a single tenancy agreement, providing for a single rent payment per period, for which all of them were jointly and severally liable, were not living in a HMO and were therefore liable to pay council tax on that property.[14]  Similarly, where two tenants who were not joint tenants each had a tenancy agreement for the whole property, the landlord was not liable for the council tax.[15]

More information about council tax payable on HMO’s is available from local councils.

Wales

The information on this page applies only to England.

[1] s.254 Housing Act 2004.

[2] s.254(2) Housing Act 2004.

[3] s.254(2) and (3) Housing Act 2004.

[4] s.254(8) Housing Act 2004.

[5] s.254(4) Housing Act 2004.

[6] s.260 Housing Act 2004.

[7] s.255 Housing Act 2004; Herefordshire Council v Rohde [2016] UKUT 39 (LC).

[8] s.255(4) Housing Act 2004.

[9] Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013 SI 2013/1169; the First-tier Tribunal and Upper Tribunal (Chambers) (Amendment) Order 2013 SI 2013/1187.

[10] s.257 Housing Act 2004.

[11] s.258 Housing Act 2004.

[12] s.259 Housing Act 2004; reg 5 Licensing and Management of Houses in Multiple Occupation and other Houses (Miscellaneous Provisions) (England) Regulations 2006 SI 2006/373.

[13] Sch. 14 Housing Act 2004, as amended.

[14] R (on the application of Goremsandu) v Harrow LBC [2010] EWHC 1873 (Admin).

[15] Shah v Croydon LBC [2013] EWHC 3657 (Admin).

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