Updated Wednesday 30 Sept. 2026
Rent Repayment Order Success stories : Unlicensed HMO addition
Under the Housing Act 2004, a property can be an HMO where three or more people from two or more households live together and share facilities such as a kitchen or bathroom. However, the national mandatory HMO licensing threshold generally starts at five occupants.
That is where Additional HMO Licensing comes in.
Local councils have the power to introduce additional licensing schemes covering smaller HMOs that would not otherwise require a mandatory licence. Where such a scheme applies, a property occupied by just three or four people from two or more households may require an HMO licence.
So, can three people live together without an HMO licence?
Sometimes, but not necessarily. Imagine three unrelated friends rent a house together and share the kitchen and bathroom. In an area without an applicable additional licensing scheme, the property may not require a mandatory HMO licence simply because three people live there. But if their local council has introduced an Additional HMO Licensing scheme covering three-person HMOs, the same property could require a licence. For example, councils including Lambeth, Ealing and Croydon have schemes covering certain HMOs occupied by three or more people from two or more households. The exact requirements, however, depend on the council and the particular licensing designation. This means that the number of tenants alone is not enough to determine whether a property should be licensed.
What should tenants check?
If you are living with two other people who are not part of your household, it is worth checking:
Whether the property meets the definition of an HMO.
Whether your council operates an Additional HMO Licensing scheme.
Whether that scheme covers your type of property and number of occupants.
Whether the property already has a valid licence.
The important point is simple: “There are only three of us” does not necessarily mean “no HMO licence is required.”
Additional licensing exists precisely because councils can extend licensing requirements to smaller HMOs in their area. A property that appears completely ordinary from the outside may therefore have licensing obligations that are not immediately obvious to its tenants. Before assuming that a property is unlicensed, or that it does not need a licence, check the rules applying in the specific local authority area.