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A HMO (House in Multiple Occupation) will need an Additional Licence if it does not fall under the Mandatory HMO Licensing Scheme. Additional Licensing Schemes are not a nationwide scheme, and in some cases can only be found in certain streets or postcodes of a borough. They are usually prevalent in areas where there has been a significant change in housing occupation from families to sharers, such as major cities.
As granted under Part II of the Housing Act 2004, the choice of introducing certain licensing schemes lies with the Local Authority in which your property is located. Schemes such as Additional HMO Licensing and Selective Licensing are often introduced by the council if it is felt that properties in the area are not being managed effectively.
Do I need an Additional HMO Licence?
Additional HMO Licensing was introduced for HMOs that do not meet all of the requirements of a Mandatory HMO Licence. Whilst it may differ from council to council, generally if your property is an HMO with 3-4 sharers and is situated in a borough that has introduced the scheme you will most likely need an Additional HMO Licence if your council has adopted the scheme. However, there are exemptions, which are as follows:
The property is subject to an Interim or Final Management Order under Part 4 of the Housing Act 2004
The property is covered by a temporary exemption notice.
The property has an exemption applying to certain student halls of residence.
A local housing authority, registered social landlord, police or fire & rescue authority or a health service body manage the property
The property is used for the purposes of a religious community
The property is occupied by just two people who form two households or is owner occupied with no more than two lodgers
Additional Licensing Schemes currently run in over a third of London Boroughs. To find out if your Local Authority requires you to have this type of licensing, visit their website where you should be able to find their requirements. As briefly mentioned earlier, councils are able to implement the licensing scheme in different ways so it may be wise to get in contact with your Local Authority directly to find out how your property may be affected.
How to apply for an Additional HMO Licence
You can apply for an Additional HMO Licence on most Local Authority websites where you will find a designated webpage. When applying, it is likely that you will be asked for the following documents:
Gas Safety Certificate
Property Insurance
Floor Plan
Automatic Fire Detection Certificate
Tenancy/Management Agreements
PAT Testing
Accreditation Membership
Land Registry Title (dated within 28 days of application)
Emergency Lighting Certificate
Fire Risk Assessment
Electrical Installation Condition Report (or equivalent)
Asbestos Survey
The Housing Act 2004 also requires you to notify various ‘relevant persons’ that you are applying for an Additional HMO Licence. 'Relevant Persons' includes freeholders, leaseholders, landlords, mortgage providers, managing agents or anyone else involved in the property. They must be informed of your application and you will be expected to supply their contact details to your local authority.
What happens if I don't license my HMO?
If you have control of or are managing a HMO which is required to be licensed under the Additional Licensing Scheme, but it is not licensed, you may be liable for prosecution in which you may face unlimited fines. Alternatively, the council may impose a penalty of up to £30,000 rather than prosecution.
The tenant or the council may also apply to the First-Tier Tribunal (Residential Tribunal) for a rent repayment order & Section 21 may not be given in relation to a shorthold tenancy of a part of an unlicensed HMO so long as it remains such a HMO. Finally, the council may take management control of the unlicensed HMO under an Interim Management Order.
Do you own an HMO? Joining a Guaranteed Rent Scheme such as that at Elliot Leigh Guaranteed Rent can save you from the hassle of maintaining a property whilst still receiving a fixed rental income. Enquire here.