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What is an HMO? The definition, when a licence is needed and the rules in each nation

What is an HMO? The legal meaning, when a licence is needed in England and Wales, what a Section 257 HMO is and where to check local rules.

  • 4 min read
  • Last reviewed 4 November 2026
  • By Your Property Check team

Key answer

An HMO, or house in multiple occupation, is a property rented by at least 3 people who are not from one household and who share facilities such as a kitchen or bathroom. In England and Wales, GOV.UK says a large HMO, rented to 5 or more people from more than one household, needs a licence.

Part 1 of 6

What an HMO is

General information, not advice. What is an HMO? GOV.UK describes a house in multiple occupation as a property rented out by at least 3 people who are not from one household, where facilities such as a bathroom and kitchen are shared.

The legal meaning sits in section 254 of the Housing Act 2004. It has three main tests:

  • The standard test: a building or part of one with living accommodation that is not a self-contained flat, where the occupants do not form a single household, pay rent or other consideration, and share or lack a basic amenity.
  • The self-contained flat test: a single self-contained flat can be an HMO if the same occupancy conditions apply to it.
  • The converted building test: a converted building with non-self-contained accommodation occupied as a main residence by people who are not a single household, with rent payable.

Part 2 of 6

What is a Section 257 HMO?

Section 254 also says a building is an HMO if it is a converted block of flats to which section 257 applies. Section 257 applies where the building work done in the conversion did not comply with the appropriate building standards and still does not, and where less than two thirds of the self-contained flats are owner-occupied. The standard depends on the age of the block. For blocks completed before 1 June 1992 (or dealt with under regulation 20 of the Building Regulations 1991), it is standards equivalent to those imposed by the 1991 Regulations as they stood on 1 June 1992. Other blocks are measured against section 1 of the Building Act 1984. Whether a block meets the test is a technical question, so a surveyor or the council is the right person to ask.

Part 3 of 6

When a licence is needed

GOV.UK says a large HMO needs a licence in England or Wales. A property is a large HMO when it meets all three conditions:

  1. It is rented to 5 or more people who form more than one household.
  2. Some or all tenants share a toilet, bathroom or kitchen facilities.
  3. At least one tenant pays rent, or their employer pays it for them.

GOV.UK also says that even if your property is smaller and rented to fewer people, you may still need a licence depending on the area. Councils set those rules, so you should check with your local council. Renting out an unlicensed HMO can lead to an unlimited fine, according to GOV.UK. A licence lasts up to 5 years, you need a separate licence for each HMO, and a council may add conditions that you can appeal to the First-tier Tribunal.

Part 4 of 6

The rules in each nation

NationDefinitionLicence triggerSource
EnglandHousing Act 2004 section 254 tests; GOV.UK summary of 3 or more people, not one household, sharing facilitiesLarge HMO of 5 or more people from more than one household; smaller HMOs may need a licence depending on the areaGOV.UK, legislation.gov.uk
WalesSame GOV.UK summary; the Housing Act 2004 definition is the legal source we readLarge HMO as above; local rules may also applyGOV.UK, legislation.gov.uk
ScotlandNot covered by the GOV.UK pageNot stated hereCheck your council and the Scottish Government
Northern IrelandNot covered by the GOV.UK pageNot stated hereCheck your council

The GOV.UK page we read covers England and Wales only, and it does not describe Scottish or Northern Irish rules, so we do not either. Licensing is run locally in every nation, so the council for the property's address is the authority to ask.

Part 5 of 6

Local additional licensing and other rules

The GOV.UK page does not use the terms additional or selective licensing, but its statement that a smaller property may need a licence depending on the area is the same idea. Your council's website will say whether an area has extra licensing, what the fee is and what conditions apply. We do not state fire safety or room size standards, because the pages we read do not set them out. Ask the council for its HMO standards before you convert or let.

Part 6 of 6

Why it matters when buying or selling

If you are buying a property that is let to several sharers, ask to see the licence if one is needed, its conditions and its expiry date, and check the council record yourself. If you are thinking of converting a home, our HMO licence cost guide explains how licence fees are set, and our HMO calculator helps you test the numbers. If you want to compare the return with a standard let, use the buy-to-let stress test.

This page is general information, not advice. Check the current rules with the council before you act.

Our take

Check the licence before you buy a let

Our view: HMO status turns on the facts, who lives there, how many households and what is shared, so do not rely on a listing's description. A large HMO needs a licence in England and Wales, and smaller ones may too depending on the area. If you buy a let to sharers, ask to see the licence, its conditions and its expiry date.

Our free property deal analyser is a BTL, HMO and BRR ROI calculator anchored to a value range, and Landlord CertCheck tracks certificate expiries for Gas, EICR, EPC, PAT and fire.

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Our opinion, drawn from the facts on this page: not advice and not a forecast. We earn from OfferCheck reports and from introducing sellers to cash buyers, so weigh it with that in mind (see our disclosure). We are not authorised or regulated by the FCA.

Questions, answered

Frequently asked questions

What is an HMO?
GOV.UK describes it as a property rented out by at least 3 people who are not from one household, sharing facilities such as a bathroom and kitchen.
Do I need an HMO licence?
In England and Wales, GOV.UK says a large HMO, rented to 5 or more people from more than one household, needs a licence. Smaller properties may also need one depending on the area, so check with your council.
What is a Section 257 HMO?
It is a converted block of flats where the conversion work did not and still does not meet the appropriate building standards and fewer than two thirds of the flats are owner-occupied, under the Housing Act 2004.
What is the penalty for an unlicensed HMO?
GOV.UK says renting out an unlicensed HMO can result in an unlimited fine. Councils may have further powers, so check with the council for the area.
How long does an HMO licence last?
GOV.UK says a licence lasts a maximum of 5 years, and you need a separate licence for each HMO.

Where this comes from

Sources

Last reviewed 4 November 2026 by the Your Property Check team. This page is general information, not legal, tax or financial advice. For your own situation, speak to a conveyancing solicitor or another qualified professional.

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