Merton HMO licence costs from £1,404 for 5 years. Properties with 5+ occupants in 3+ storeys need mandatory licensing. Avoid £30,000 fines.
Merton HMO licensing requires a mandatory licence for any property housing 5 or more people across 2 or more storeys — and the consequences of getting this wrong cost landlords tens of thousands of pounds.
What Triggers an HMO Licensing Requirement in Merton?
Mandatory HMO licensing in Merton is triggered when a property is occupied by 5 or more people forming 2 or more separate households, sharing facilities such as a kitchen or bathroom. This is the national mandatory threshold set under the Housing Act 2004, as amended by the Licensing of Houses in Multiple Occupation (Mandatory Conditions) (England) Regulations 2018. Crucially, the storey count was removed as a trigger for mandatory licensing in October 2018, meaning a single-storey flat housing 5 qualifying occupants now requires a licence in the same way a 3-storey house does. If your property falls below 5 occupants but sits in a designated additional licensing area, separate rules may apply — Merton has the power to introduce additional licensing schemes by resolution of the council, and landlords should check the council's current scheme register before assuming they are exempt.
Converted buildings of self-contained flats that do not meet the 1991 Building Regulations standard — known as Section 257 HMOs — may also require licensing under a separate additional licensing scheme. These properties, where fewer than two-thirds of flats are owner-occupied, are a frequently overlooked trigger. A property does not have to look like a traditional bedsit house to require a Merton HMO licence.
What Does an HMO Licence in Merton Cost?
The mandatory HMO licence fee in Merton is structured in two stages. The non-refundable application fee covering the first stage of assessment is approximately £702, with a further fee of approximately £702 due upon grant of the licence — bringing the total 5-year cost to around £1,404. These figures reflect Merton's published schedule and are correct as of 2025, though fees are subject to council review and landlords should verify the current schedule directly with Merton Council's Private Sector Housing team before submitting.
Accreditation through a recognised landlord scheme may attract a discount of around 10% in some London boroughs, though Merton's specific discount eligibility should be confirmed at point of application. Licences run for a maximum of 5 years, meaning the annualised cost is approximately £281 per year — a relatively modest outlay compared to the £30,000 civil penalty exposure for operating without one.
How Do You Apply for an HMO Licence in Merton?
Applications are submitted online through Merton Council's licensing portal. You will need to nominate a licence holder — typically the freeholder or a managing agent — who must be deemed a fit and proper person under Section 66 of the Housing Act 2004. A proposed licence holder with any unspent conviction relating to fraud, violence, sexual offences or housing-related offences will be refused. The council has a statutory duty to determine applications within a reasonable period, and it is common for the process to take between 8 and 16 weeks depending on inspection requirements and officer workload.
A fee of £160 is payable in some councils for variation of an existing licence if circumstances change mid-term — for instance, if the maximum occupancy changes or the licence holder changes. Confirm Merton's current variation fee at the time of application.
What Documents Do You Need to Submit?
A complete Merton HMO licence application requires a floor plan to scale showing room sizes in square metres, a current gas safety certificate (required annually under Gas Safety (Installation and Use) Regulations 1998), an electrical installation condition report (EICR) no older than 5 years, and evidence of working smoke and heat alarms compliant with BS 5839-6:2019. Portable appliance testing (PAT) records, an Energy Performance Certificate (EPC) rated E or above, and a copy of all current tenancy agreements are also required. A fire risk assessment is mandatory for properties of 3 or more storeys or where there are 5 or more occupants. Room sizes matter: single bedrooms must be at least 6.51 square metres and shared rooms at least 10.22 square metres under the Licensing of Houses in Multiple Occupation (Mandatory Conditions) (England) Regulations 2018.
What Are the Penalties for Operating an Unlicensed HMO in Merton?
Failure to licence an HMO that requires one is a criminal offence under Section 72 of the Housing Act 2004, carrying an unlimited fine on conviction. In practice, Merton and other London councils increasingly use Civil Penalty Notices instead of prosecution — these carry penalties of up to £30,000 per offence. Crucially, each unlicensed property is a separate offence, so a landlord with 3 unlicensed HMOs faces up to £90,000 in civil penalties. Additionally, tenants in an unlicensed HMO can apply to the First-tier Tribunal for a Rent Repayment Order (RRO) covering up to 12 months of rent — on a property generating £2,000 per month, that represents a potential repayment liability of £24,000 on top of any penalty.
Landlords convicted of operating an unlicensed HMO are also listed on the Rogue Landlord Database, which is publicly accessible and can affect future licence applications across all London boroughs.
What This Means for Merton Landlords
Private landlords with HMO properties in Merton face a straightforward compliance decision. A 5-year licence costs approximately £1,404 and protects against penalties that can exceed £30,000 — a risk ratio of more than 21 to 1. Beyond the financial exposure, unlicensed operation creates reputational risk and jeopardises future licensing across all London boroughs. The licensing regime also requires landlords to maintain specific management standards under the Management of Houses in Multiple Occupation (England) Regulations 2006, meaning the licence is not a one-time obligation but an ongoing framework for property management. Landlords unsure whether their property meets the threshold should request a pre-application conversation with Merton's Private Sector Housing team before works begin or tenants move in.
| Council | Licence Type | Fee (5-year) | Occupancy Threshold | Scheme Expiry | Accreditation Discount |
|---|---|---|---|---|---|
| Merton | Mandatory HMO | £1,404 | 5+ persons, 2+ households | Ongoing mandatory | Confirm with council |
| Wandsworth | Mandatory HMO | £1,560 | 5+ persons, 2+ households | Ongoing mandatory | 10% NLA/RLA members |
| Lambeth | Mandatory + Additional | £1,610 | 5+ persons (mandatory) | Additional scheme review 2025 | 10% accredited landlords |
| Croydon | Mandatory + Additional | £1,200 | 5+ persons (mandatory) | Additional scheme to 2027 | None confirmed |
| Sutton | Mandatory HMO | £1,056 | 5+ persons, 2+ households | Ongoing mandatory | None confirmed |
| Kingston upon Thames | Mandatory HMO | £1,380 | 5+ persons, 2+ households | Ongoing mandatory | 10% accredited landlords |
| Bromley | Mandatory HMO | £990 | 5+ persons, 2+ households | Ongoing mandatory | None confirmed |
No — mandatory licensing in Merton is triggered at 5 or more occupants forming 2 or more separate households. A 4-person property falls below the threshold, though if Merton introduces an additional licensing scheme covering smaller HMOs, properties with as few as 3 occupants could require a licence. Always check Merton Council's current scheme register.
The total 5-year HMO licence fee in Merton is approximately £1,404, paid in two stages of around £702 each — one on application and one on grant. This works out at roughly £281 per year and is significantly less than the £30,000 civil penalty for operating without a licence.
You risk a civil penalty of up to £30,000 per property under Section 72 of the Housing Act 2004, plus a potential Rent Repayment Order from tenants covering up to 12 months of rent. On a property renting at £2,000 per month, that RRO exposure alone reaches £24,000. You may also be added to the Rogue Landlord Database.
An HMO licence in Merton lasts a maximum of 5 years, after which you must renew. Councils can issue shorter licences — sometimes as brief as 1 year — where there are management concerns or outstanding compliance issues. Renewal applications should be submitted before the existing licence expires to avoid a gap in licensed status.