HMO Licensing.

Perhaps some forum members can shed a little light on this for me.

I own a 2 bedroom 1 bathroom flat on the ladder that is currently tenanted. Previously to this I lived there with my wife.

The current tenants have decided to use the living room as a bedroom as the kitchen is quite large. They put the council tax in all 3 names of the tenants. Everything was going fine with this until I was contacted via post, and then by phone, by Community Housing Services at Haringey Council. 

They're insisting I print out a 15 page application form to turn the property into a HMO. I believe the charge is in the region of £208 per bedroom for a 5 year license. Threatening letters, very insistent that they're allowed access to the building to inspect it etc.  Very persistent indeed.

The thing that irks me is that my property isn't a house or a flat that has been turned into a bunch of bedsits. It's 3 friends living in a flat together. I've read through the application form and it asks for details on each 'bedsit room' and also details about what shared kitchens/bathrooms there are etc.

Apparently the guidelines for HMO's stipulate that if you have 3 people from 2 or more families living under the same roof, its a HMO. I just don't feel this is fair. Am I wrong?

I also don't see what benefit I'm getting out of having to part with over £600 for essentially nothing. I can't think of a single way it benefits me.

Thoughts?