Tenants of Unlicensed HMO Secure Rent Repayment Orders

Four tenants have successfully secured rent repayment orders (RROs) totalling £23,177 after their landlord failed to obtain a mandatory house in multiple occupation (HMO) licence, in breach of housing regulations.

Background: Unlicensed HMO Breaches Additional Licensing Requirements

The tenants rented a four-bedroom property from September 2022 to September 2023 in an area governed by an additional HMO licensing scheme. Under Section 72(1) of the Housing Act 2004, any HMO occupied by three or more unrelated tenants forming two or more households must be licensed. However, the landlord only applied for a licence in August 2023 almost at the end of the tenancy.

Tribunal Findings: No Reasonable Excuse for Licensing Failure

The First-tier Tribunal (FTT) concluded that the landlord had unlawfully managed an unlicensed HMO for nearly a year. It rejected the landlord’s claim that he had a “reasonable excuse” due to unawareness of the new licensing rules. The Tribunal made clear that ignorance of the law does not constitute a defence, especially given that the landlord’s letting agent had emailed the tenants incorrectly asserting that a licence was already in place.

Condition of the Property and Proportional Repayment

Although the Tribunal acknowledged the licensing scheme was relatively new at the time the tenancy began, it also noted:

  • The property was in poor condition upon move-in

  • Tenants lacked basic appliances like a working oven and microwave

  • Heating issues persisted and were not promptly resolved

  • Neither the landlord nor agent took accountability for these deficiencies

As a result, the FTT awarded the tenants 65% of the maximum repayable rent, taking into account both the unlawful management and the substandard living conditions.

Legal Insight: Protecting Tenants' Rights in HMOs

This case serves as a stark reminder for landlords of their legal obligations under HMO licensing schemes. Failure to comply can result in substantial financial penalties and rent repayment orders.

If you're a tenant concerned about housing standards or a landlord unsure of your licensing duties, our specialist property litigation team can help.

📞 Contact Willett & Co Solicitors today for expert advice on landlord-tenant disputes, HMO regulations, and rent repayment claims.

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.