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A house in multiple occupation (HMO) is a building divided into bedsits or a shared house or a building where generally facilities are shared between the occupiers so that the individual residential units are not self contained.

The significance of this is that the building may well need a licence from the local authority.

The basic rules are the following:-

  • A property is deemed to be a HMO if both of the following apply:-
  • At least 3 tenants live there forming more than 1 household and;
  • They share toilet, bathroom or kitchen facilities with other tenants.

A property is a large HMO if:-

  • At least 5 tenants live there forming more than 1 household and;
  • They share toilet, bathroom or kitchen facilities with other tenants.

A household is either a single person or members of the same family who live together. A family include people who are:-

  • Married or living together including people in same sex relationships.
  • Relatives or half relatives for example grandparents, aunts, uncles and siblings.
  • Step-parents and step-children.

A property does not necessarily need an HMO licence just because it falls within the definition of HMO. However, a mandatory HMO licence is required for larger properties which:-

  • Comprise 3 or more stories,
  • Are occupied by 5 or more persons and;
  • Are occupied by persons living in more than 1 household.

It should also be noted that some local authorities impose additional licencing requirements on other types of HMO. There are also certain exemptions which can apply.

When purchasing a property or a building in multiple occupation, very careful checks need to be carried out to see whether or not a licence is required to operate the property or building.

In addition to this there are also a number of other rules and regulations that apply as well as requirements to hold gas and electrical safety certificates, EPCs and other relevant documents which relate to residential buildings.

It is possible when purchasing a property of multiple occupation to include in the local search application an optional enquiry to ascertain whether or not the property in question is a house in multiple occupation or whether it is designated or proposed to be designated for selective licencing in accordance with the Housing Act 2004.

If you have any questions about this topic, please contact Stephen Brower, or any member of the Property team.

Edwin Coe LLP is a Limited Liability Partnership, registered in England & Wales (No.OC326366). The Firm is authorised and regulated by the Solicitors Regulation Authority. A list of members of the LLP is available for inspection at our registered office address: 2 Stone Buildings, Lincoln’s Inn, London, WC2A 3TH. “Partner” denotes a member of the LLP or an employee or consultant with the equivalent standing.

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