Government announces draft regulations to except newly-procured asylum-seeker accommodation from HMO licensing

05 Apr 2023

Housing, Local Government, Planning and Environment, Public Law and Judicial Review

By Dean Underwood and Jack Barber

What is proposed?

The Housing Act 2004 aims, among other objectives, to regulate the standard, occupation and management of privately rented accommodation in England and Wales. To that end, Part 2 provides for local housing authorities (LHAs) in England and Wales to license houses in multiple occupation (HMOs) and, by doing so, to mitigate the safety risks that typically arise in, and increase with the size of, multiply-occupied accommodation.

Generally, a building or part of a building will be an HMO for the purpose of Part 2 if it meets the requirements of section 254, for example if it meets the standard or converted building test. Under Schedule 14 however some such buildings, for example those managed or controlled by public sector bodies, or those regulated otherwise than under the 2004 Act, are already excepted from Part 2’s licensing requirements.

The Secretary of State has recently announced draft regulations that will except more such buildings from the requirements of Part 2 licensing.

What is the effect of the proposed amendments?

The draft regulations, which are presently before Parliament and not yet in force, will insert new subsections 5A and 5B into section 254. In effect, they will except newly-procured accommodation in England, which is used to accommodate asylum seekers under sections 4, 95 and 98 of the Immigration and Asylum Act 1999 (the 1999 Act), from HMO status for the purpose of Part 2.

The exception will apply where arrangements to provide the accommodation begin during a period beginning with the coming into force of the draft regulations and ending on 30 June 2024, and will last for a period of 2 years from the date when the arrangements begin. The Government proposes to repeal the amendments on 1 July 2026.

Why now?

Recent reports have estimated that more than 45,500 people seeking asylum in the UK are still accommodated in hotels, costing the Government £6m per day. The Government has indicated that it will end the use of hotels for such purposes, and will explore using disused cruise ships and military barracks instead. As the Home Office’s use of hotels has become increasingly controversial, asylum accommodation and support service contractors are now seeking properties of all types to house people seeking asylum in the UK, including traditional HMOs, family properties, former care homes, residential and student accommodation. The Home Office has expressed concern, however, that the 2004 Act’s licensing provisions, under Part 2 at least, are preventing them from doing so effectively.

The Explanatory Memorandum to the draft regulations acknowledges the context:

“The Home Office is seeking to house more asylum seekers across local authorities, and more quickly in appropriate and cost-effective accommodation. Asylum Accommodation Service Contract (AASC) providers (who act on behalf of the Home Office to discharge the functions of the Secretary of State under section 4, 95 or 98 of the Immigration and Asylum Act 1999), have raised concerns that HMO licensing regulation is posing a barrier to acquiring such properties. Much of the dispersed asylum accommodation (especially for single individuals) is provided through Houses in Multiple Occupation (HMOs) – there currently are approximately 6000 HMO properties accommodating 28000 asylum seekers […]. This temporary exemption is being introduced to remove barriers that may cause a delay or challenge to acquire more sustainable and cost-effective accommodation for asylum seekers particularly given the pressure on estate, and alternative regulation via standards in the AASC.”

How does this affect local housing authorities’ regulatory responsibilities?

No further guidance is anticipated in respect of the changes. The Explanatory Memorandum notes that:

“This change will have an impact on local authorities. During the period of the temporarily (sic) exemption, local authorities will no longer licence (sic) HMOs used as asylum accommodation so will no longer receive licensing fees in respect of these properties. The change may also impact demand for other local authority services. The Home Office will provide funding to local authorities in recognition of the costs associated with accommodating asylum seekers in their area”.

The Government has indicated that it will monitor the legislation at regular meetings between the Home Office, the Department for Levelling Up, Housing and Communities, and local authorities in order to understand the impact of the draft regulations and ensure the alternative regulation of housing standards.

The draft regulations do not, however, preclude all such regulation under the 2004 Act. As drafted, they do not apply retrospectively, i.e. to accommodation occupied pursuant to arrangements made under section 4, 95 or 98 of the 1999 Act before the regulations come into force. Nor do they apply for any purpose other than that of Part 2 of the 2004 Act. They do not therefore preclude the regulation of such accommodation under section 234 of the 2004 Act, in Part 7, and the Management of Houses in Multiple Occupation (England) Regulations 2006 (the 2006 Regulations). Nor do they preclude the potential licensing of such accommodation under Part 3. In future, therefore, where Part 2 no longer applies, local authorities may look to other parts of the 2004 Act and to secondary legislation made pursuant to it for alternative means of regulating the condition, occupation and management of asylum-seeker accommodation.


The challenge of accommodating people seeking asylum has grown in the past year, and the appropriateness of measures taken by the Government to redress the imbalance between demand and supply will surely continue to make headlines, both political and legal. The Government’s recently-published draft regulations are no exception. Politically, they call into question whether it is really necessary or appropriate to sacrifice the objectives of HMO licensing at the altar of expediency, particularly given the vulnerability of those seeking asylum in the UK, who are presently accommodated by the Home Office. Legally, some may see the draft regulations as tacit acknowledgement that accommodation occupied under section 98 of the 1999 Act, the licensing status of which has been much-debated of late, may in principle be an HMO for the purpose of Part 2; and others will surely look to the 2006 Regulations in future, and other provisions made in and under the 2004 Act, to ensure that such accommodation is appropriately regulated. Whatever the ultimate effect of the draft regulations, one thing is clear: the issues associated with accommodating asylum seekers are merely evolving, not abating.

Cornerstone Barristers is uniquely placed to offer clients support across public law, planning and housing issues arising in relation to accommodating people seeking asylum, and several members have been instructed on related matters. Earlier this year, members hosted a webinar on the topic, which is available on YouTube here. Dean Underwood and Jack Barber also summarised the broad issues here