Section 257 HMO Southwark: The Free Building Licence and the Trap Behind It

What a Section 257 HMO Is

A Section 257 HMO is a building that has been converted into self-contained flats where the conversion did not comply with the Building Regulations that were in force at the time (1991 standards or later), and fewer than two-thirds of the flats are owner-occupied. The building itself is classified as a house in multiple occupation under Section 257 of the Housing Act 2004, even though each flat may be fully self-contained with its own kitchen and bathroom.

In Southwark, the additional HMO licensing designation covers a Section 257 building when it is at least three storeys, has at least three self-contained flats, and the building and flats are under the same ownership or control. The council licences the building structure rather than the individual flats.

The £0 Fee — and Why It Is Not the Full Story

Southwark charges nothing for the Section 257 building-level licence. The fee is literally £0, with no Part A or Part B payment.

This is where many landlords stop reading, and it is where things go wrong.

The building licence covers the shared structure — common hallways, stairwells, fire escape routes, the roof, external walls. It does not cover the individual flats inside. If those flats are let to private tenants and the building sits in one of Southwark's 19 selective licensing wards, each flat needs its own selective licence at £945.

A qualifying Section 257 building with three flats in Peckham (a selective licensing ward) would need:

• One Section 257 building licence: £0
• Three selective licences for the individual flats: £945 each = £2,835

The total licensing cost is £2,835, not zero.

If any individual flat within the building is also a small HMO — let to three or four unrelated tenants sharing amenities — that flat needs an additional HMO licence (£1,433) instead of a selective licence.

How to Tell If a Building Qualifies

Three conditions must all be true:

1. The building was converted into self-contained flats (not purpose-built as flats from the start)
2. The conversion did not meet the Building Regulations in force at the time of conversion
3. Fewer than two-thirds of the flats are owner-occupied

If the building was purpose-built as flats, or the conversion was done to full Building Regulations standards, Section 257 does not apply. Purpose-built blocks with HMO flats inside them fall under the additional licensing scheme directly, not through the Section 257 route.

A pre-1991 conversion is a reason to check the applicable Building Regulations and conversion records; its age alone does not establish that it meets the Section 257 test.

Application Process

The Section 257 building licence application goes through Southwark's standard online portal. You enter the building address, declare the building structure details, and confirm the conversion history. Because the fee is £0, there is no Part A or Part B payment — but the fit and proper person declaration, document uploads and processing timeline still apply.

You must apply separately for each individual flat that needs a selective or additional HMO licence. These are separate applications with separate fees.

Why This Matters for Enforcement

Operating a licensable property without a licence exposes the landlord to a civil penalty of up to £40,000 per offence. A building with three unlicensed flats in a selective ward is three separate offences, not one. For offences committed on or after 1 May 2026, tenants can also apply for rent repayment orders covering up to 24 months of rent per flat.

The £0 building licence gives no protection for the flats inside. Both layers need to be in place.

For a walkthrough of every Southwark licensing scenario — including Section 257 buildings — see the full guide.

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