Landlords have had a tough time over the last couple of years and if you are a landlord with an HMO then things could be about to get worse for you. There are new HMO regulations coming into force in 2018 and this includes a mandatory licensing scheme.
Making Life easier for Councils
There was an HMO Reform Consultation held designed to produce a standard that councils across the country could follow when it comes to HMO licensing. Landlords waited with nervous anticipation for the outcome of this consultation.
What are the Components of the Mandatory Licensing?
The new licensing rules will apply to many HMO’s up and down the country. At the moment around 60,000 HMO’s in the United Kingdom have to obtain a license. When these new rules come into force it is estimated that around 174,000 more properties will also need an HMO license.
If an HMO property is occupied by 5 or more people, making up 2 or more households then a license will be required. Households can be defined as parents with children, partners that are married, co-habiting or have a civil partnership and even individuals.
At the moment only three story properties require a license but under the new rules single and two storey buildings will need a license if the 5 person rule is in force. This includes properties that have had a bedsit conversion.
Many landlords are going to have to apply for an HMO license with the new rules. There is a 6 month grace period under discussion but this is not set in stone. The bottom line is that landlords that do not hold a license when they are required to hold one could face criminal prosecution. Civil fines of £30,000 are also in the mix.
Other Rules for HMO’s
There are new rules concerning the size of bedrooms. If a room is less than 6.52 square metres for an individual or less than 10.23 square metres for a couple then councils will disregard these as bedrooms. If people are only staying for a short time then there will be no enforcement of this rule.
Unlimited fines await landlords that break these rules. For landlords that rent HMO rooms to students this could be a real problem. There may be some flexibility in this rule if there is a large communal area but this is by no means certain.
A rule on rubbish disposal is coming. Holders of HMO licenses must ensure that there is an adequate number of bins or other receptacles for storage and disposal of rubbish. You need to be smart here and work out on average how much rubbish a tenant generates each week and then provide a slightly oversized bin for each of them.
Finally HMO landlords need to be “fit and proper” to obtain a license. If a landlord has a conviction for fraud, violence, dishonesty or sexual abuse it is very unlikely that a license could be obtained. The same goes for landlords that have broken tenant, landlord or housing laws.