Lauren Walker, a Senior Associate in the Real Estate team looks at the impending changes to HMO Licence rules to be brought in by Reading Borough Council, effective from 1 March 2026.
Reading Borough Council is expanding its property licensing regime, introducing new measures designed to improve housing standards.
Currently, only HMOs occupied by five people or more are required to have a licence. The Council is exercising its discretionary powers to introduce additional licence requirements for smaller HMOs and from 1 March 2026 this additional licensing scheme will apply borough wide.
Who Needs a Licence?
HMOs with 3 – 4 occupants that are not already caught by current mandatory licensing regime will now need to apply for a licence. This therefore applies to smaller shared houses and flats which meet the statutory definition of an HMO. Landlords are encouraged to consult the Council’s FAQs for a full explanation of how HMO’s are defined.
How to apply?
The Council have created a dedicated application portal which provides step-by-step guidance on how to submit the application for the 3-4 person scheme.
Agents can register from 1 February 2026 whilst Landlords can apply from 1 March 2026.
Exclusions
The Council is not including Section 257 HMOs within the scope of the additional licensing scheme. Section 257 HMOs are:
- Buildings (or parts of buildings) converted into self‑contained flats,
- Where the conversion did not comply with 1991 Building Regulations and less than two-thirds of the flats are owner‑occupied.
However, individual flats may still require a licence. Although the building itself is excluded as a whole, individual flats within a converted building or a purpose-built block can still be HMOs.
This means that:
- Individual HMO flats occupied by 3–4 persons will require an additional licence, and
- Some of these flats may previously have been exempt from the mandatory scheme but will now fall under the new borough‑wide provision.
The existing rules for larger HMOs will remain in place – please refer to our article on the mandatory licencing requirements for further information.
Future plans?
In addition to these 1 March 2026 changes, the Council is also preparing to introduce selective licensing across specified areas of Reading. Although these schemes are not yet in force and formal designations have not been made, the Council has set out its intended phasing with Battle Ward being the first area designated and Redlands and Park Wards to be brough into the scheme in a phased roll out.
Selective licensing will apply to all private rented properties occupied by single households, including:
- Houses let to one family
- Single-occupancy flats
- Any non-HMO rented property within the designated area
Landlords in affected wards would be required to apply for a licence to continue letting their properties once the scheme is in force. At present, applications cannot yet be made, and the schemes are still awaiting formal approval.
What Next?
Landlords should check whether a licence is required for any HMOs in their portfolios and review compliance requirements including fire safety, amenity standards and management arrangements ahead of the new scheme coming into force.
