Key Points

• Croydon, a South London borough, is now one of the strictest local authorities in England for landlords seeking to create Houses in Multiple Occupation (HMOs), according to new planning data.
• Between 2021 and 2025, Croydon Council processed 405 HMO-related planning applications — the ninth busiest local authority in England for such decisions.
• The council refused 266 of those 405 applications, resulting in a rejection rate of 65.7 per cent — nearly two-thirds of all HMO planning applications.
• This high rejection rate places Croydon among the most restrictive councils in England when it comes to HMO conversions.
• Croydon faces severe housing pressures: around 8,600 households are currently on the borough’s housing waiting list, with over 3,600 households in temporary accommodation.
• Only around 800 social homes become available each year in Croydon, exacerbating the shortage of affordable accommodation.
• In July 2025, Croydon Council launched a crackdown on unauthorised HMOs, visiting 21 addresses in Thornton Heath, Norbury, New Addington, Central Croydon, Addiscombe and Purley.
• From 1 September 2026, an Additional HMO licensing scheme will apply to all smaller HMO properties in Croydon, requiring licences even for smaller-scale operations.
• The council has also launched a free early-intervention service for landlords to help prevent evictions and reduce homelessness.
• Data comes from Planning Lens’s “The HMO Squeeze” report, which analysed HMO planning trends across English local authorities.

Croydon (South London News) June 19, 2026 —Croydon has emerged as one of the most restrictive local authorities in England for landlords seeking to create Houses in Multiple Occupation (HMOs), with planning data revealing that nearly two-thirds of all HMO planning applications were rejected between 2021 and 2025.

Why is Croydon rejecting nearly two-thirds of all HMO planning applications?

As reported by the journalist covering the Planning Lens “The HMO Squeeze” report for mylondon.news, the figures show Croydon Council refused 266 out of 405 HMO-related planning applications — a rejection rate of 65.7 per cent.

This places the South London borough among the strictest local authorities in the country when it comes to HMO conversions.

The council processed the ninth-highest volume of HMO planning applications in England during this period, demonstrating that landlord interest in converting properties to HMOs remains strong despite the tight regulatory environment.

How severe is Croydon’s housing shortage?

Croydon is facing significant housing pressures. As reported by Croydon Council’s official newsroom on September 18, 2025, around 8,600 households are currently on the borough’s housing waiting list, with more than 3,600 households living in temporary accommodation.

Only around 800 social homes become available each year in Croydon, according to the council’s December 30, 2025 announcement on tenancy fraud crackdowns.

This stark imbalance between demand and supply has led the council to take a tough stance on HMOs, which can sometimes reduce the availability of family-sized homes.

What actions has Croydon Council taken against unauthorised HMOs?

In July 2025, Croydon Council launched a crackdown on unauthorised Houses of Multiple Occupation. As reported in the council’s newsroom on July 14, 2025, enforcement officers visited 21 addresses believed to be unauthorised HMOs across Thornton Heath, Norbury, New Addington, Central Croydon, Addiscombe and Purley.

This enforcement action demonstrates the council’s commitment to ensuring that all HMOs comply with licensing and planning requirements.

What new licensing rules will apply from September 2026?

From 1 September 2026, Croydon will implement an Additional HMO licensing scheme that applies to all smaller HMO properties in the borough.

As stated on Croydon Council’s official website, this means additional HMO licensing will apply even to smaller-scale operations that previously may not have required a licence.

This expansion of licensing requirements is part of the council’s broader strategy to regulate HMOs more tightly and ensure properties meet safety and management standards.

How is the council supporting landlords to prevent evictions?

Despite its strict stance on HMOs, Croydon Council has also launched support measures for landlords. On September 18, 2025, the council announced a free early-intervention service designed to help private landlords address issues before they lead to eviction.

“As reported by Croydon Council’s newsroom,” the service offers landlords advice on resolving disputes, managing tenants with rent arrears, and understanding their legal obligations.

The goal is to keep people in their homes, avoid unnecessary eviction proceedings, and reduce the impact of homelessness.

What does Planning Lens’s “The HMO Squeeze” report reveal?

The data on Croydon’s HMO rejection rate comes from Planning Lens’s “The HMO Squeeze” report, which analysed HMO planning trends across English local authorities between 2021 and 2025.

The report identified Croydon as the ninth busiest local authority in England for HMO-related planning decisions, processing 405 applications during this period.

Despite this high volume of applications, the council’s 65.7 per cent rejection rate stands out as significantly higher than the national average, reinforcing its position among England’s most restrictive councils for HMOs.

Why is Croydon taking such a strict approach to HMOs?

The council’s strict stance on HMOs appears linked to its severe housing shortage and the need to preserve family-sized homes.

HMO conversions often involve splitting larger properties into smaller units, which can reduce the availability of accommodation suitable for families.

With over 8,600 households on the waiting list and only 800 social homes becoming available annually, the council faces pressure to balance housing demand with the need to maintain diverse housing stock.

Background: Croydon’s Housing Development and HMO Regulation History

Croydon has long faced housing pressures typical of fast-growing London boroughs. The council’s approach to HMO regulation has evolved over several years.

In September 2020, Croydon launched a consultation on removing permitted development rights for HMOs, which would stop the conversion of homes to HMOs without requiring a planning application.

This earlier consultation reflected growing concerns about the impact of HMO conversions on neighbourhood character and housing diversity.

The council’s subsequent strict rejection rates for HMO planning applications demonstrate that these concerns translated into concrete policy action.

The July 2025 crackdown on unauthorised HMOs, involving visits to 21 addresses across six neighbourhoods, showed the council’s willingness to enforce its regulations actively. This enforcement complements the planning rejection policy, creating a two-pronged approach:

preventing new unauthorised HMOs through planning refusals while removing existing unauthorised HMOs through enforcement.

The upcoming September 2026 Additional HMO licensing scheme will further tighten regulation by requiring licences for smaller HMO properties that previously may have operated without formal oversight.

This expansion reflects the council’s ongoing effort to bringing all HMOs under regulatory control.

Prediction: How Croydon’s Strict HMO Policy Will Affect Landlords, Tenants, and the Housing Market

Croydon’s 65.7 per cent HMO rejection rate and expanding licensing requirements will likely have several significant effects on different groups in the borough.

Landlords seeking to convert properties to HMOs in Croydon will face considerably higher barriers. The high rejection rate means that most HMO planning applications will be refused, reducing the potential for this investment strategy.

The Additional HMO licensing scheme from September 2026 will increase compliance costs even for smaller operations, potentially making HMO investment less attractive overall.

Some landlords may redirect their investment to neighbouring boroughs with less restrictive HMO policies, potentially reducing property investment activity in Croydon.

The free early-intervention service for landlords may help some operators stay compliant and avoid evictions, but it does not address the fundamental challenge of planning refusals.

For tenants and residents seeking housing

The strict HMO policy may help preserve larger family-sized homes, which could benefit families on the housing waiting list.

However, it may also reduce the overall supply of affordable rental accommodation, as HMOs often provide lower-cost options for single people and small households.

With 8,600 households already on the waiting list and only 800 social homes becoming available annually, any reduction in affordable rental options could prolong waiting times for some residents.

Tenants in existing HMOs may face increased scrutiny as the council expands licensing requirements, potentially leading to improved property standards but also higher rents to cover compliance costs.

For Croydon’s housing market and affordable housing strategy

The council’s approach reflects a strategic choice to prioritise family housing over HMO accommodation. This may help address specific needs of families on the waiting list but could create shortages for single people and small households who rely on HMO-style accommodation.

The combination of high planning rejection rates, enforcement against unauthorised HMOs, and expanded licensing creates a comprehensive regulatory framework that will likely reduce the number of HMOs in the borough over time.

This could help preserve neighbourhood character and housing diversity but may also reduce overall rental capacity.

The housing shortage remains severe regardless of HMO policy, with the council’s own data showing the gap between demand (8,600 households) and supply (800 social homes annually).

The HMO policy alone cannot solve this fundamental shortage, which will require broader affordable housing development and social home construction.

Landlords and tenants should monitor the September 2026 licensing scheme implementation closely, as compliance requirements will directly affect property operations and rental costs.

The council’s support services for landlords may help mitigate some negative impacts, but the core challenge of planning refusals remains unaddressed for those seeking to create new HMOs.