Understanding HMOs: A beginner’s guide to shared homes

Finding an affordable, safe place to live is a priority for everyone, but the path to getting a home that is suitable for your circumstances is different for everyone. When exploring options in the private rental market, you will frequently come across the term HMO.

HMOs are part of the UK’s housing system. This guide breaks down what an HMO actually is, who it serves, and how management rules aim to protect tenants and local communities.

What exactly is an HMO?

HMO stands for ‘house in multiple occupation’. In simple terms, it is a property that is rented out to a group of people who are not from the same family, but who share basic living spaces like the kitchen, bathroom or living area.

While many shared houses fit this description, housing laws target homes based on their size. Across the UK, HMOs fall under legal regulation if they reach these specific thresholds:

• In Scotland and Northern Ireland – every HMO with three or more unrelated people (forming three or more separate households) must be licensed by law
• In England and Wales – laws make licensing mandatory for larger properties with five or more residents, but many local councils use their powers to lower this threshold to three or four people.

If a couple and a single friend move into a house together, that represents two households and doesn’t hit the threshold for licensing. But once an HMO meets the size threshold set by local laws, it must be registered, licensed and checked by the responsible council to ensure it is safe.

The role of HMOs: An option for affordable and shared living

Shared living arrangements form part of the mix of affordable house types across the UK. It provides a shared solution for a wide range of people at different stages of life, including:

• Young professionals – workers starting out in their careers who want the flexibility of living in popular, central locations close to their jobs; sharing a home allows them to live in areas that might otherwise be out of reach, avoids the cost of renting a full property alone, and provides a way to meet and live with other people
• Students – people moving away from home for higher education who want an affordable, social option close to their university or college campus; sharing a house makes managing bills easier and gives them an opportunity to live with peers during their studies
• Smaller households – single people, those experiencing a change in their life circumstances, and people relocating to the area for a job; for these groups, a shared home is a cost-effective way to settle into a new area or adjust to a new stage of life, without the high expense of renting a large property alone.

Data from our UK Housing Review highlights just how much younger people rely on private renting. In the general housing market, 60% of 16-to-24-year-olds, and 41% of 25-to-34-year-olds in the UK rented their homes from a private landlord in 2023/24.

By providing a choice of housing options for smaller households to live, access higher education and locate close to work, HMOs provide a flexible network of homes in the wider housing market. For many, sharing a home helps lower individual costs while relieving pressure on social housing waiting lists and single-occupancy private rentals.

Regulated for safety and standards

All private rentals must follow general housing laws regarding property condition, basic fire safety and landlord responsibilities. However, because several families live under one roof, licensed HMOs must meet stricter health, safety and legal standards than other private rentals.

This regulation is rooted in history. For decades, governments have stepped in to tackle overcrowding, poor sanitation and the fire risks associated with shared living, where research historically showed tenants faced a higher risk of injury and death.

Different modern laws now exist across the UK to ensure these properties are managed properly:

• In England, rules are set by the Housing Act 2004
• In Wales, the Housing Act 2004 sits alongside Management of Houses in Multiple Occupation (Wales) Regulations 2006
• In Scotland, standards are set under the Housing (Scotland) Act 2006 (part five)
• In Northern Ireland, the sector is managed under the Houses in Multiple Occupation Act (Northern Ireland) 2016.

Under these laws, local councils are responsible for checking and licensing HMO properties. To legally run an HMO, a landlord should check with the responsible council to see if they need a licence.

To get this licence, landlords must pass checks. This includes proving they are a “fit and proper” person to manage a property, holding up-to-date fire and electrical safety certificates, and agreeing to strict limits on how many people can live in the property based on the size of the rooms.

The role of the Chartered Institute of Housing (CIH)

As the professional body for housing, CIH helps make sure the homes we live in meet high standards. We work closely with governments and authorities across the UK to help shape housing rules and laws. We also provide training, qualifications and professional standards for the managers who look after rented homes every day.

Our education includes:

• CIH Level 2 Award in Letting and Managing Residential Property (England, Wales and Northern Ireland)
• CIH Level 3 Certificate in Letting and Managing Residential Property (England and Wales)
• The LETWELL Programme (Scotland).

By supporting housing professionals to manage properties fairly and professionally, we help make sure that private renting remains a safe, high-quality and reliable option for everyone.

Standing together for safe communities

As housing professionals, we want to be clear: an HMO is a type of house where people live. Unfortunately, these homes have sometimes been targeted during racist attacks and violent unrest.

They are homes to our neighbours, colleagues and friends from all walks of life who contribute every day to our communities. Everyone, no matter where they come from, has the right to feel safe and secure inside their own home.

To support this, CIH is committed to providing clear, accessible information on housing rights for everyone, including new arrivals and the advisers who support them. If you or someone you know needs to understand their rights and find a safe place to live, use our free, dedicated Housing Rights website to explore up-to-date, easy-to-use information for the UK.