Newham Section 257 HMO: Converted Flats Licensing Rules

If you own or manage flats in a converted building in Newham, the licensing rules are not as straightforward as checking the number of tenants. A building that was split into self-contained flats without meeting the applicable building standards could be a Section 257 HMO — and that classification carries its own licensing obligations.

What Makes a Building a Section 257 HMO

Section 257 of the Housing Act 2004 defines a specific type of House in Multiple Occupation. A building qualifies when two conditions are both true:

1. The building has been converted into self-contained flats, but the conversion work did not comply with the appropriate building standards and still does not comply with them. For conversion work completed before 1 June 1992 (or covered by regulation 20 of the Building Regulations 1991), the statutory benchmark is equivalent to the 1991 regulations as they stood on 1 June 1992; for other conversions, it is the requirements in force when the work was done.
2. Fewer than two-thirds of the self-contained flats are owner-occupied. For this test, owner-occupied includes a flat occupied by its freeholder, a person with a lease of more than 21 years, or a member of that person's household.

This matters because a block of individually self-contained flats might look nothing like a traditional shared house. Each flat has its own front door, kitchen and bathroom. But if the building's conversion still fails the applicable standards and fewer than two-thirds of the flats are owner-occupied, the whole building is treated as an HMO in law.

How Newham Licensing Applies to Section 257 Buildings

Newham runs three licensing schemes simultaneously: Mandatory HMO, Additional HMO, and Selective. The classification of a Section 257 building depends on where it sits and what's happening inside it.

The building as a whole must be assessed against the Section 257 criteria. The freeholder or building owner who controls the communal parts — hallways, stairwells, shared entrance — needs to verify whether the whole-building classification triggers licensing obligations under Newham's local designation.

Individual flats within the building are evaluated separately. A flat let to a single household in one of Newham's 21 designated wards needs a Selective Licence. A flat shared by three or four unrelated people forming two or more households needs an Additional HMO Licence. A flat with five or more people from two or more households needs a Mandatory HMO Licence regardless of ward.

The two excluded wards — Royal Victoria and Stratford Olympic Park — are exempt from Selective and Additional licensing, but Mandatory HMO rules apply borough-wide.

The Trap Landlords Walk Into

The most common mistake is assuming self-contained means exempt. Landlords who own a flat inside a converted Victorian or Edwardian terrace often believe their individual flat licence covers everything. It doesn't address the building-level Section 257 question at all.

Another frequent problem: landlords don't know whether the original conversion met Building Regulations. For conversions completed before 1 June 1992, Section 257 uses the 1991 Building Regulations benchmark described above. For later conversions, the relevant standards are those imposed by regulations at the time. In either case, the conversion work must still fail the applicable standards for the building to meet this part of the test.

What to Do If You Suspect a Section 257 Classification

Start with the building's history. Check whether planning permission and Building Regulations approval were obtained for the conversion. If the freeholder or managing agent cannot produce completion certificates, the conversion may not have been compliant.

Then count the ownership split. If fewer than two-thirds of flats are owner-occupied, the threshold is met.

If both conditions apply, the building owner and individual flat landlords each need to address their respective licensing obligations. For individual flat landlords, the standard Newham application process through the My Newham portal applies — the licence type depends on your flat's occupancy and ward location.

Our Newham landlord licensing guide walks through the full address-first decision framework, including Section 257 scenarios, with worked examples showing how each licence type applies to converted buildings.

Key Points to Remember

• Section 257 is about the building's conversion standards and ownership split, not the number of tenants in any one flat.
• Individual flat landlords still need their own licence based on occupancy numbers and ward location.
• The freeholder managing communal areas should verify any building-level licensing obligations.
• Converted buildings that still fail the applicable standards are the ones to assess against the Section 257 test.
• If a building or flat that requires a licence is left unlicensed, civil penalties can reach £40,000 per offence under the rules in force from 1 May 2026.

See more England guides →