The number of HMO licences being granted by local planning authorities is on the decline, according to new figures.
New mandatory and additional licence approvals by councils across Great Britain fell by -6% in 2024, according to Searchland, which reveals that 2023 saw a total of 25,445 new licences issued, while last year this dropped by 1,498 to 23,947.
However, 2024 saw some authorities grant significantly more new HMO licences, most significantly in Oxford where 1,823 new licences marked an annual increase of 1,341 compared to 2023. Meanwhile, approvals also saw an annual increase of more than 500 in Bristol (+838), Lambeth (+759), Hammersmith & Fulham (+544), and Charnwood (+533).
Meanwhile, Haringey (1,158), Southwark (1,087), and Hammersmith & Fulham (1,007) also granted more than 1,000 new HMO licences last year. Following this annual change, Lambeth is Britain’s new HMO licence hotspot where 2024’s total of 2,515 new licence approvals is equivalent to 10% of the national whole.
Co-founder of Searchland, Hugh Gibbs, says the decline in licences being granted comes at a time when we arguably need more rental accommodation to ease the high demand from tenants.
He believes this reduction has been driven by a greater reluctance by councils due to a move towards risk-based licensing; authorities scrutinise the duration of licences, for example, those HMOs deemed higher risk by a council could receive a one or two-year licence rather than five years.
“It’s also fair to say that tighter regulations, particularly with regard to mandatory room sizes, may have also deterred investment,” adds Gibbs.
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