Will taking in a lodger create an HMO (House in Multiple Occupation)?

The short answer is yes possibly…

The term HMO is used in many different context by many different institutions and legislation:

• The Housing Act 2004
• Housing Health and Safety Rating System (HHSRS)
• Local Council HMO Licensing departments (Three types of licensing exist)
i. Mandatory Licensing
ii. Selective Licensing
iii. Additional Licensing
• Local Council Planning departments
i. 3 – 6 Person HMO – “C4″ Use Class HMO
ii. 7+ Person HMO – “Sui Generis” Use Class HMO
• Mortgage companies (every lender will vary their definition)
• Insurance companies (every insurer will vary their definition)

Within the context of housing, the definition of HMO is contained in sections 254 and 257 of the Housing Act 2004.

A building occupied by an owner has limited exclusion. The owner’s household (direct family) is excluded plus another 2 persons are excluded. Therefore if you take in three non-family lodgers your property will be an HMO. However, if you take in two uncles, a cousin and a ‘live-in’ au-pair, your property will not be a HMO, even though there will be more people living in it.

Further, if you there are 5 or more people living on 3 or more floors from two or more households (regardless of what you call them – tenants, lodgers or licensees) then your property will be an HMO and is subject to mandatory licensing.

Fines And Penalties For Failing To Comply With HMO Duties

Any failure to comply with a duty set out in the Management of HMO Regulations 2006 is a criminal offence and liable to a £5,000 fine per individual duty. This is set to increase to an unlimited fine.

If a landlord operates an unlicensed HMO which should have had a license, this is a criminal offence and a fine up to £20,000 is payable. This is set to become an unlimited fine.

A breach of any conditions of the licence is £5,000 per individual condition but is set to become an unlimited fine.

No section 21 notice may be given in relation to a tenancy of an unlicensed HMO. An application for a HMO license is sufficient to allow the service of a notice.

If you are not sure if your house falls within the definition, have a word with your local authority.

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