HMO (House in Multiple Occupation) – the changing rules! Why me?

Since 2004, a property of three storeys or more, with five or more unrelated people, making up two or more households is classed as a mandatorily licensable HMO.

Landlords have needed to be aware of what constitutes a storey, it has been classed as a usable space forming part of the living accommodation ie.an attic, basement, mezzanine half landing with a bathroom off.

From October 2018 (expected 1st) the government, and in turn local authorities will be classing all properties with five or more unrelated people, making up two or more households, as needing a mandatory license; the number of storeys will no longer matter.

There will also be two new HMO License conditions that will apply:

• The national minimum size for rooms used for sleeping will range from 4.64 square meters depending on the age and number of occupants.
• There will also have to be compliance with council refuse schemes; there will need to be suitable facilities for storage and the disposal of household refuse.

Purpose built flats comprising no more than two flats in the building, including those above and under business premises and older converted flats (this can be just one of several, yet the whole building may not require a license) with five or more unrelated people making up two or more households in the flat will now need a license.

It will be implemented in two phases – Phase 1 will be a six month grace period to allow time to apply for license – during this time the landlord will not be able to issue a Section 21 Notice until it has been applied for. Do note that there will be no grace period for Additional or Selective license properties.

Phase 2 will see the Local Authorities (LA) able to fine the landlord who has not applied or obtained an exemption to remove HMO capability – a maximum fine of up to £30k is possible and also the potential for a Rent Repayment Order (RRO) to be issued if a license is not obtained when due.

Landlords of existing properties will be given a maximum of eighteen months to make any necessary changes when applying for an expired license.

This will impact on a lot more regulations that will need to be checked. One main one is the checking of the property, especially the smoke alarms, communal corridors and emergency lighting – often the time periods and standards expected by the LA will be highlighted in the license.

It is important that the inspections are recorded and documented so in the event of a fire or problem later there is a clear written record of the management. These latest measures are all part of the government`s desire to drive up standards in the Private Rental Sector and are expected to add about 160,000 more HMO`s into mandatory licensing.

Whilst the landlord`s duty of care remains the same, do be aware that the more vulnerable the people who are let to, the greater the responsibility for diligence and the accountability will become if a local authority assessment has taken place. Using the HHSRS (Housing Health Safety Rating System), a Hazard Awareness Notice can be issued or worse an Improvement Notice!