(H.M.O) House of Multiple Occupation
The Housing Act 2004 established a framework for licensing houses in multiple occupation (HMOs) with the aim of ensuring safe, well managed accommodation for tenants and to raise standards across the sector. In practice, licensing focuses on how the property is occupied and managed rather than solely on the physical condition of the building. Local Authorities (LAs) have a duty to determine whether an HMO presents an appropriate level of risk to occupants and to impose conditions that address any identified deficiencies.
Mandatory licensing applies to HMOs that are occupied by five or more people forming two or more households and shares facilities such as kitchens or bathrooms. In such cases the LA must assess whether the property meets the required management and safety standards and whether the landlord is suitable to hold the license. If a property falls within the mandatory scheme, the LA has discretion to set additional conditions beyond the statutory baseline to reflect local needs and the specific risks associated with the premises.
Additional licensing provides a mechanism for LAs to extend licensing to other categories of HMOs within their area that may not meet the four or more occupancy threshold but still pose heightened risks due to poor management, facilities or location. This allows authorities to target situations where tenants are particularly vulnerable or where standard provisions are insufficient to protect occupants.
When granting a licence, the LA considers several key factors. These include the suitability of the HMO for the number of occupants, ensuring that the premises can accommodate the residents safely and without undue crowding; the suitability of the facilities in terms of adequacy and condition for the number of tenants and shared use; and the suitability of the landlord and the overall management arrangements, including the ability to enforce tenancy terms and respond to issues promptly. The licence will also specify the mandatory standards that must be met continuously.
Mandatory standards include requirements relating to safety and ongoing compliance. In broad terms, the HMO must have:
– an annual gas safety certificate issued by a competent engineer;
– safe electrical appliances and furniture supplied by the landlord, with the landlord providing a declaration of safety on demand to the council;
– installed smoke alarms and their continued proper functioning, with a declaration on position and condition supplied to the council;
– a statement of the terms on which occupants occupy the HMO, communicated to tenants.
The LA may also impose additional conditions concerning the facilities of the HMO, its condition and the management of the property. These conditions can reflect local circumstances or specific risks identified during the assessment.
Increasingly, LAs are using licensing as a lever to require evidence of energy performance to ensure that HMOs meet minimum energy efficiency standards. In practice, many scheme members are asked to provide Energy Performance Certificates (EPCs) for HMOs to demonstrate compliance with licensing requirements. The EPC itself is a measurement used for energy efficiency and is not a direct trigger of HMO licensing or a substitute for compliance with HMO licensing standards. It is used by some LAs as an indicator of the overall condition and efficiency of the property, and to inform decisions about improvements or exemptions. It is important to note that EPCs are separate from the Environmental Performance of Buildings (EPB) or related legislative regimes and that HMOs are primarily regulated under housing and licensing provisions, not EPB prerequisites.
It is helpful to distinguish HMOs from domestic dwellings as defined under EPB regulations. HMOs differ in several key respects:
– they are occupied more intensively than standard domestic or commercial properties, with multiple unrelated tenants sharing facilities;
– licensing focuses on the management and occupancy arrangements and whether the property is in a fit condition for that occupancy, rather than on the overall suitability of the building for general occupation;
– licensing does not prevent the property from being rented as a single-family dwelling, even if an HMO licence is present or held; the license is a separate regulatory requirement applying to the occupancy arrangement and management standards;
– EPB or related energy performance regulations consider different drivers, primarily the design and use of the building, and apply standard occupancy assumptions in some calculations rather than reflecting actual occupancy patterns.
In contrast, EPB-related assessments such as RdSAP (the standard assessment procedure for the energy performance of a dwelling) and SBEM (used for non-domestic buildings) apply a standard occupancy factor to their calculations and may not reflect the actual number of occupants in the building. This means that an HMO, even if licensed, may have energy efficiency characteristics that differ from those assumed in a general energy performance calculation.
Enforcement and consequences of non-compliance are important practical considerations. Local Authorities have powers to issue improvement notices or prohibition orders, and in serious cases may impose civil penalties or pursue criminal offences against landlords who fail to meet licensing conditions or safety requirements. Non-compliance can lead to suspension or revocation of the licence, potential fines, and reputational damage for the landlord. Tenants have a right to expect that the HMO is managed responsibly and that safety obligations are met, with mechanisms in place to report concerns to the LA or other relevant authorities.
From a best-practice perspective, landlords should ensure robust management arrangements, maintain up-to-date certification and safety checks, keep clear records of all compliance activities, and engage with tenants transparently about occupancy terms and house rules. Regular internal audits of compliance against licensing conditions and safety requirements can help identify gaps before they trigger enforcement action. Where improvements are necessary, timely planning, budgeting for required works, and communication with the LA can help secure licence renewal and reduce the risk of penalties.
In summary, HMO licensing provides a focused framework for ensuring the safety, suitability, and proper management of higher-density rental housing. It operates alongside broader energy performance and building regulation regimes, with licensing decisions driven by occupancy patterns and management standards rather than purely by the physical characteristics of the building itself. Landlords should remain aware of both the licensing requirements and evolving local authority expectations, including any requirements for EPCs or related documentation, to maintain compliant and well-managed housing.
Summary
Occupancy data is not a determining factor in the calculation of the energy performance for a building; rather, the design use and construction features that define the building’s thermal characteristics and energy systems largely drive the assessment. While it can influence operational behavior in practice, the formal appraisal relies on the characteristics that are documented in the building plans, services, fabric performance, and the intended use class at the time of design.
The designated or intended use of the building at the time of design is important because it informs which performance model and input assumptions are appropriate for the assessment. For example, a retail space, an office, a warehouse, or a public facility each have different typical patterns of occupancy, lighting loads, equipment energy, ventilation requirements, and heating and cooling profiles. The chosen assessment method should reflect these underlying use characteristics to produce a representative energy performance certificate that corresponds to the building’s actual functional behavior.
RdSAP and SBEM are two commonly used methodologies for energy assessments, and the selection between them depends on the original designed use, construction details, and the regulatory framework applicable to the property. RdSAP is often used for existing small to medium-sized domestic and non-domestic buildings where a simplified, standardized approach is appropriate, while SBEM is suitable for commercial buildings with more complex usage and service systems, where a more detailed modeling of heat gains, ventilation, and plant efficiency is required. In cases where the original design use aligns with one method, the assessment should consistently apply the corresponding assumptions and data inputs to ensure comparability.
A broader issue arises when similar properties are assessed using different methodologies, yet yield certificates that appear inconsistent with one another. This can occur because each method makes different default assumptions about input data such as occupancy profiles, lighting power densities, and plant efficiencies, or because the original design use is interpreted differently during the data collection process. As a result, two buildings that are functionally similar might produce certificates with varying energy performance ratings or recommended improvements, which can undermine confidence in the comparability of certificates and the transparency of the assessment process.
To address these concerns, it is advisable to document clearly the original design use, the justification for the chosen assessment method, and the key input assumptions used in the modeling. Where possible, data should be aligned with the building’s actual service installation details, historical consumption patterns, and any relevant project-specific design documentation. Ensuring consistency in the interpretation of design use across assessments and providing justification for any deviations from standard practice can help improve comparability and reduce discrepancies between certificates.
Stakeholders, including building owners, occupants, advisers, and regulators, should engage in a collaborative review of the assessment approach when substantial design-use differences exist between similar properties. Where necessary, sensitivity analyses can be conducted to show how changes in input assumptions, such as occupancy levels or equipment loads, influence the resulting certificate, thereby aiding in informed decision-making for energy efficiency investments and regulatory compliance. In sum, careful consideration of design use, method selection, and transparent documentation are essential to produce reliable, comparable, and credible energy performance assessments.
Guidance
Expanding on the points raised, it is important to recognise that energy performance assessment frameworks are structured around the concept of a whole building or site, rather than isolated spaces within it. The DCLG guidance you cite states that an EPC is not required for an individual room when rented out because a single room is not, on its own, a building or a building unit designed or altered for separate use. Consequently, the regulatory position and the EPC methodology used should reflect the status of the entire dwelling or building rather than individual rooms within it. In practice, this means that, for regulatory purposes such as sale or tenancy of the whole property, the EPC must be prepared for the whole dwelling or building as a single asset.
Where a dwelling is subdivided for separate use, regulatory considerations typically require that any transaction involving the entire building be accompanied by an EPC that covers the building in its entirety. If, however, a building is designed and used in a way that involves distinct, separately usable parts with independent access and separate energy systems, there may be circumstances where a more granular assessment is considered for certain regulatory or commercial purposes. It remains essential to consult the prevailing guidance and, where relevant, the specific requirements of the energy performance framework in force at the time of assessment.
With regard to methodology, SAP (Standard Assessment Procedure) or RdSAP (Reduced data SAP) should normally be used for the assessment of domestic dwellings where the original designed use is a single-family dwelling, such as a Victorian mid-terrace house. The SAP/RdSAP approach models typical domestic energy use and is generally more representative for individual, self-contained homes intended for private residential use. This yields results that are well aligned with the expected energy consumption patterns of owner-occupied or single-family let properties.
For buildings originally designed to provide shared amenities or non-domestic forms of occupancy, such as halls of residence, student accommodations, or other multi-occupancy facilities that function as a single coherent property, the SBEM (Simplified Building Energy Model) method is often more appropriate. SBEM is designed to capture the energy performance of larger, more complex buildings with communal systems and shared operational characteristics, thus producing a more accurate representation of energy use for these types of properties.
It is worth noting that regulatory regimes can evolve over time, and amendments or refinements to EPC calculations and applicability criteria may be introduced. Therefore, practitioners should verify the current guidance and ensure that the chosen assessment method aligns with the intended use, the structure of the building, and its energy systems at the time of assessment. In all cases, the objective remains to provide a robust, transparent, and comparable measure of energy performance that reflects the true energy characteristics of the building as a whole, while recognising the practical distinctions between single-family dwellings and more complex, multi-use facilities.
Examples of properties commonly classified as HMOs include:
- Shared houses or flat shares: A house or flat rented to three or more occupants, such as students, young professionals, or work colleagues, who share a kitchen, bathroom, and living room.
- Bedsits: Buildings converted into separate, non-self-contained rooms where each tenant has their own bedroom and sometimes a kitchenette, but shares a bathroom or toilet with others.
- Hostels and guest houses: Establishments providing accommodation for people without permanent housing, including those referred from homelessness services.
- Staff accommodation: Housing provided for employees or workers, such as a house supplied by an employer.
- Shared student housing: Large houses or flats shared by students, who may have separate tenancy agreements or a joint tenancy.
- Section 257 HMOs: Buildings converted into self-contained flats with their own kitchen and bathroom but not meeting the standards of the 1991 Building Regulations, where fewer than two-thirds of the flats are owner-occupied.
- Bed and breakfasts (B&Bs): Some B&Bs or hotels used for temporary housing or short-term lets, particularly for individuals without another permanent home.
Joint and several
If you grant a joint and several tenancy where all the tenants are on one agreement, then this is, in legal terms, no different to letting a normal dwelling to a single family. Therefore, one EPC will be required for the whole dwelling.
Individual let rooms
Where individual rooms in a building are rented out on separate tenancies and there are shared facilities (e.g. kitchen and/or bathroom), an EPC is not required. An EPC is only required for a dwelling that is self-contained, meaning that it does not share essential facilities such as a bathroom/shower room, wc or kitchen with any other dwelling, and that it has its own entrance. This is because an EPC is only required on the rental of a building or part of a building ‘designed or altered to be used separately’. Renting a room does not meet the ‘part of a building’ definition. Put simply, an EPC is only required for a habitable unit if it is self-contained.
Example 1
A house or flat is rented by a number of tenants who have exclusive use of their bedrooms but share a kitchen and bathroom. In this case each tenant has a contract with the landlord for the parts they have access to, but not for the whole dwelling. An EPC is therefore not required each time a tenant moves, although one will be required for the whole house if it is sold or rented as a whole.
Example 2
A group of friends want to rent a property and there will be a single contract between the landlord and the group for the rental of the whole dwelling (ie it is a joint and several tenancy). An EPC is required for the whole dwelling.
Example 3
Individual tenants rent rooms in a hall of residence. Each room does not constitute a building or part of a building designed to be used separately. An EPC is not required, for each individual room. However, an EPC will be required on the whole building if it is sold or rented. It will also be required on self-contained units within the hall, for example, a self-contained caretaker’s flat, if this is sold or rente
Conclusion
While the current use of the energy performance certificate (EPC) within the housing management order (HMO) process is acknowledged, it is essential to emphasize that the selection of the assessment methodology is governed by the requirements set out in the energy performance building (EPB) framework. In other words, the decision should be driven by the official criteria and guidance that specify which methodology is appropriate for a given building type, rather than by how the building is currently occupied or managed under an HMO arrangement.
The key determinant for selecting the correct assessment approach should be the building’s actual physical characteristics, its constructed design, and the original intended use at the time of completion. Factors such as the construction type, insulation levels, heating and cooling systems, ventilation, airtightness, thermal bridges, and the presence of any energy-efficient features or retrofit works must be taken into account. Occupancy status or rental arrangement—whether the property is rented as an HMO or used as a traditional dwelling—should not alter the methodological requirements dictated by the EPB guidelines.
To ensure compliance and consistency, it is advisable to undertake a thorough review of the EPB framework relevant to the jurisdiction in question, including any accompanying technical standards, certification schemes, and deemed-to-comply criteria. This review should identify the precise methodology that corresponds to the building’s size, use class, and construction period. Where uncertainties exist, consultation with a certified energy assessor or the competent authority is recommended to avoid misapplication of methods, which could lead to inaccurate energy performance ratings or noncompliance with regulatory obligations.
In addition to selecting the proper methodology, there should be a clear plan for data collection and verification. This includes gathering architectural drawings, original specifications, as-built measurements, heating and hot water systems details, ventilation types, and existing energy-saving measures. Any changes made since construction that affect energy performance must be documented and, if required, incorporated into the assessment through appropriate modeling adjustments or updated calculations.
Stakeholders, including property owners, managers, tenants, and regulatory compliance teams, should be informed of the rationale behind the chosen methodology and the implications for compliance, enforcement, and potential energy improvement recommendations. Clear communication helps align expectations regarding certification timelines, potential retrofits, cost considerations, and the anticipated impact on occupancy and tenancy management.
Ultimately, the correct approach is to apply the EPB-derived methodology that aligns with the building’s physical and functional attributes, not with its current occupancy status as an HMO. By focusing on the structural design, original use, and technical characteristics, the process will yield a robust and defensible energy performance assessment that supports regulatory compliance, accurate benchmarking, and informed decision-making regarding any necessary energy efficiency improvements.