Scope: Scotland. Cited to Scottish instruments throughout. HMO licensing in Scotland is Part 5 of the Housing (Scotland) Act 2006. It is not additional licensing under section 56 of the Housing Act 2004, which is a discretionary English designation — Scotland licenses every qualifying HMO nationally and has done since long before English additional licensing existed.
Our compliance check now covers Scotland, and so does the fine calculator. Enter a Scottish postcode and both answer in Scots law, cited to Scottish instruments — the check with your council’s registration and HMO position where we hold it, the calculator with the Scottish maximum for each offence and, where the consequence is not a fine, what it actually is. Still England and Wales only: the tenancy agreement checker, whose findings come from England and Wales statutes.
The refusal nobody plans for
A landlord who satisfies every physical and management standard can still be refused, and the reason has nothing to do with the property.
Section 131A of the 2006 Act: the local authority may refuse to grant an HMO licence if it considers that there is — or, as a result of granting the licence, would be — overprovision of HMOs in the locality.
This is the provision that catches investors who buy on the assumption that a compliant conversion produces a licence. In parts of Scotland with concentrated student or shared housing, it does not. The property can be perfect and the answer can still be no.
What the council must weigh
Section 131A(4) directs the authority, in deciding whether there is or would be overprovision in a locality, to have regard to:
- the number and capacity of licensed HMOs in the locality;
- the need for housing accommodation in the locality, and the extent to which HMO accommodation is required to meet that need;
- such other matters as the Scottish Ministers may specify by order.
And under section 131A(2), in deciding whether to refuse, it must have regard to whether there is an existing HMO licence in effect for that accommodation, and to the views (if known) of the applicant and of any occupant.
The existing-licence limb matters commercially. A property with a live licence is in a materially different position from an unlicensed one in the same street, because the council must have regard to the fact that the licence exists. That is part of what you are buying when you buy a licensed HMO, and part of what you lose if you let a licence lapse and reapply.
Overprovision policy is local and published
Councils set their assessment of overprovision by locality, and they publish it. The locality may be a ward, a street, a postcode sector or a defined zone, and the threshold may be a percentage of dwellings or a raw count. Because it is local, it is the one part of Scottish HMO licensing where your council’s own policy governs the outcome rather than the Act — so read it before you commit to a purchase or a conversion.
Suitability, which is the other refusal route
Section 131 — a different section, and a different test — provides that the authority may grant a licence only if it considers the accommodation is suitable for occupation as an HMO, or can be made suitable by including conditions.
Section 131(2) lists what it must consider:
- its location;
- its condition;
- any amenities it contains;
- the type and number of persons likely to occupy it;
- whether any rooms have been subdivided;
- whether any rooms have been adapted so as to alter the situation of the water and drainage pipes;
- the safety and security of persons likely to occupy it;
- the possibility of undue public nuisance.
The subdivision and pipework limbs were added later and they are aimed squarely at conversions. A flat chopped into extra bedrooms, or one where a shower room was added by moving the drainage, is not merely a building-standards question — it is a named statutory consideration on the licence application.
Conditions, and the offence for breaching one
Under section 129(2), the authority may determine an application by granting the licence with or without conditions, or refusing it. Only an owner may apply — section 129(1) — so a managing agent cannot make the application in their own name.
Breaching a condition is a criminal offence, and it is a different offence with a different maximum from operating unlicensed:
| Offence | Section | Maximum |
|---|
| Owner of an unlicensed HMO that requires a licence | 154(1) | £50,000 — s.156(1)(a) |
| Licence holder breaching a licence condition | 154(2)(a) | £10,000 — s.156(1)(b) |
| Permitting occupation while a rectification requirement under s.145(2) has effect | 154(2)(b) | £10,000 |
| Authorising an unspecified agent to facilitate occupation | 154(2)(c) | £10,000 |
| Agent causing a condition to be breached | 154(5) | £10,000 |
| Representing a lapsed licence as still having effect | 154(3) | level 3, £1,000 |
| Obstructing a power of entry under s.181(1)(e) | 154(6) | level 3, £1,000 |
Each carries a defence of reasonable excuse on the face of section 154. Note that these are Scottish summary maxima and they are real caps: the provision that made equivalent English summary fines unlimited extends to England and Wales only, so £50,000 and £10,000 mean what they say here.
The rectification route before prosecution
Section 145(2) lets the authority require rectification of a breach. Section 154(2)(b) then makes it an offence for the licence holder to permit occupation while that requirement has effect. In practice this is the sequence you will meet: a requirement first, and the offence attaching to continuing to let through it — which means the expensive mistake is usually ignoring a notice rather than the original breach.
What to do before you buy or convert
- Read the council’s overprovision policy for the specific locality. Not the council’s HMO page — the policy.
- Establish whether a licence is currently in effect on the property, and whether it transfers or must be reapplied for.
- Check planning separately. Licensing and planning are different consents, and an HMO licence does not authorise a change of use.
- Price the conditions. A licence granted with conditions is still a grant, and the conditions are the works.
Information tool, not legal advice. Scottish law only.