Lewisham Council: “One household” clause puts rentals at risk

The HMO trap: tenants in the crossfire

How a dormant lease clause, licensing whiplash and POCA risk are squeezing homes out of the market. The Big Retort…

An email from Lewisham’s Private Sector Housing Agency about an Additional HMO licence landed like a brick. More than a year after the council invited me to apply, it now says my application is rejected. It’s the freeholder’s doing. But—who’s the freeholder?

“Lewisham Council… have confirmed that renting your property as an HMO would put you in breach of your lease and therefore put your lease at risk which can lead to forfeiture.”

Then came the Hobson’s “choices”:

Option 1: Withdraw and apply for a Temporary Exemption Notice (TEN) to “regularise” matters—i.e., kick out the sharers—avoiding enforcement for an unlicensed HMO.

Option 2: Press on and risk forfeiture of the lease.

Wait—what? This is the same council that extended licensing to my area and invited me to pay £1,500 to license three sharers—whose only offence was being unrelated. Now I’m asked to evict good tenants or gamble the lease. Either route funnels landlords toward criminalisation risks and tenants toward homelessness.

A trap with two springs

Strip away the jargon and you see the trap. Withdraw, and the council can assert you operated without a licence—triggering a civil penalty of up to £30,000 and a Rent Repayment Order (RRO) for up to 12 months’ rent. Proceed, and you’re allegedly in breach of a “single household only” lease covenant—opening the door to forfeiture. Heads, the tenants go. Tails, the lease goes. In both scenarios, the council gets leverage.

This isn’t about fire safety, overcrowding or poor conditions. It’s about legal whiplash: one arm invites landlord licensing; another cites a lease clause to torpedo it. If that clause is now being applied across Lewisham’s portfolio—not just against me—it could obstruct licences for ordinary shared living, even a resident owner with two lodgers. That’s not sensible regulation; it’s a rental supply–shrinking machine.

Legal hindsight, retrofitted

When these leases were drafted, three sharers on one AST were commonly treated as one household for lease purposes. No one suggested that a shared kitchen and bathroom breached the covenant. The Housing Act 2004 later defined unrelated sharers as multiple “households” for public law licensing—rightly, to raise standards. Lewisham now appears to retrofit that public-law definition back into a private lease clause. The result is a hybrid: a licensing regime that lures you in, and a lease interpretation that pushes you back out—and all by the same body.

The rights implications aren’t theoretical. There’s Article 8 ECHR (respect for home), Article 14 (non-discrimination), and the Equality Act 2010 (indirect discrimination), because a neutral “single household only” rule bites hardest on those who rely on shared living—young workers, students, carers, low-income renters, new arrivals. Call it social cleansing by lease clause or, in my view, targeted leasing by Lewisham for reasons that need daylight.

A bigger market consequence

If Lewisham’s reading spreads, the shockwaves won’t stop at my front door. Since 1980, more than 2 million homes have been sold under Right to Buy. England has 4.77 million leasehold dwellings; about 1.82 million are in the private rented sector; and roughly 41% of ex-Right-to-Buy homes are now owned by private landlords. Apply “single household only” rigidly, and you strip out a chunk of shared housing overnight—the segment that props up affordability in high-cost cities. It deepens the very shortage licensing was meant to manage. (Let’s call it SHOO—Single Household Only: Out.)

From licensing and lease dispute to POCA

Here’s where it gets truly perverse. If enforcement is routed through the criminal courts—say for operating an unlicensed HMO or breaching a notice—a conviction can unlock the Proceeds of Crime Act 2002 (POCA). The numbers then pivot from fines to the “benefit” alleged from the offence. Prosecutors often argue that all rent received during the relevant period counts as “proceeds of crime.” Courts can impose confiscation orders up to the lower of that “benefit” or the defendant’s available assets. Fail to pay and you face further enforcement—even a default prison term.

So a technical licensing dispute mutates into asset and liberty risk. Not because the property is unsafe or overcrowded, but because criminalisation opens a lucrative recovery route. In my view, that’s a dangerous incentive structure: regulation by POCA, not by proportionality. It’s not the case of finding criminality, but making it criminal in order to profit.

The council’s two voices

One arm says “licence sharers.” Another says the lease forbids more than a single household and hints at forfeiture if you continue. The public message: “we’re bringing HMOs up to standard.” The private message: “we’ll refuse the licence and say you’re in breach.” Two huskies pulling in opposite directions—and the sled is the tenant’s home and the leaseholder’s asset.

If this is policy, it deserves an honest public justification. If it’s an error, fix it—and confirm publicly that lawful shared living (including lodgers and carefully managed HMOs) will not be retro-cast as a lease breach. Anything less caves in the very middle of the market we rely on to house working people—especially in London, where rents are through the roof.

What this looks like on the ground

I did what the council asked: applied, paid, cooperated, hosted three good tenants. Safety and standards were not the issue. Instead, I’m served a Hobson’s choice: evict to dodge criminal penalties, or carry on and face forfeiture—and, downstream, POCA exposure. That’s not regulation; it’s a pincer movement.

Meanwhile, tenants—who did nothing wrong—face displacement. Some will be nudged into worse conditions or further from work, education and care networks. Others will fall out of the sector altogether. Multiply that across a borough—or across councils that copy—and you shrink the rental base and harden the crisis.

A better path home

If councils want to raise standards, they should enforce standards: timely inspections, proportionate civil penalties for genuine non-compliance, and a clear pathway for bringing properties into the licensing net. Where lease covenants conflict with modern housing needs, there should be transparent guidance and—where appropriate—consent processes with reasonable conditions. Weaponising old covenants to nullify present licensing is a policy cul-de-sac.

Where I am now—and what I’m asking

I’ve filed a public Freedom of Information request for the internal correspondence, policies and risk assessments behind this decision, and for data on how many leaseholders have been warned, threatened, or steered into TENs.

Follow the FOI: (public link here)

Good. But please don’t use this as a strategy to criminalise me. Please don’t then reach for POCA. Please don’t move to forfeit the lease. The public—in the form of my tenants—deserves a fair hearing too.

If you’re a council leaseholder—anywhere—told that “one household only” blocks a lawful HMO or lodger arrangement, I’d like to hear from you. If you’re a tenant asked to leave because of this clause, tell me your story. This isn’t just about one flat. It’s about whether we regulate to keep homes safe and available—or regulate to shrink supply and flip housing disputes into criminal cash machines.

Until Lewisham (and any council tempted to follow) can show how this approach improves safety, protects tenants, and grows supply, the message to renters and leaseholders is bleak: the rules you followed yesterday can be turned against you tomorrow. And when housing policy is rewritten by the back door, the people on the doorstep pay the price. It’s them I care about.