Types of Licensing Schemes

The Housing Act 2004 introduced licensing for certain categories of HMOs in England and Wales. It is compulsory to licence larger, higher-risk dwellings under the Mandatory Licensing Scheme if:

1. Further amending from 1 October 2018 removing the HMO pre-condition or any part of it to comprise of three storeys or more to now be any storey along with points 2 and 3 below.
2. it is occupied by five or more persons, living in two or more households
3. the occupiers share some facilities
4. Also 1st October 2018 new mandatory conditions to be included in licences were also introduced, prescribing national minimum sizes for rooms used as sleeping accommodation and requiring landlords to adhere to council refuse schemes.

Local authorities are also able to licence other types of HMOs under an Additional Licensing Scheme, if they can establish that other avenues for tackling problems in these properties have been exhausted.

In areas of the country which are subject to low housing demand or significant anti-social behaviour problems, local authorities may run a Selective Licensing Scheme under which all privately rented properties, not only HMOs, must be licensed.

Before the local authority can set up an Additional or Selective scheme, they must follow a particular legal process, including consulting those likely to be affected such as tenants, landlords, landlord organisations and others in the local community

Licensing is intended to make sure that:

1. a landlord is a fit and proper person (or employs a manager who is)
2. the standard of management of the property is adequate
3. in the case of HMO licensing, each HMO is suitable for occupation by the number of people allowed under the licence

This is to ensure vulnerable tenants are protected and that HMOs are not overcrowded. High-risk HMOs can be identified through licensing and targeted for improvement by a local authority under the Housing Health and Safety Rating System. New mandatory conditions to be included in licences have also been introduced, prescribing national minimum sizes for rooms used as sleeping accommodation and requiring landlords to adhere to council refuse schemes.