HMO Licensing Changes, Landlords Be Aware

HMO Licensing Changes, Landlords Be Aware 1

Changes to HMO licensing have been unveiled in the Government’s consultation paper titled: Houses in Multiple Occupation and residential property licensing reforms published today.

The Government’s main focus seems to be raising standards and protecting vulnerable people in our society. The cynic in me can’t help a great way to raise extra revenue as they remove the 3 storey rule. Now all shared homes with 5 or more people from 2 or more household fall under mandatory licensing rules.

Key Points in the Houses in Multiple Occupation and residential property licensing reforms consultation paper.

  1. The Government intends to remove the existing “three storey” rule so that buildings with 5 or more people from 2 or more households, regardless of the number of floors, will fall within the scope of mandatory licensing.
  2. Minimum room sizes occupied for sleeping in licensed HMO’s – 6.52 sq. m for one person and 10.23 sq. m for two persons.
  3. It’s important to note that “semi-commercial” flats above commercial properties and converted properties that contain 5 or more people from 2 or more households will require a licence.
  4. HMO’s will need to provide adequate rubbish disposal and storage facilities. These facilities will need to be suitable for the number of occupants.
  5. Financial penalties; failure to obtain a licence or a breach can carry a maximum fine of £30,000. However, for any person contravening an overcrowding notice this, these fines can now be unlimited.

The government’s estimate that the proposals will make around 174,000 additional HMOs (including flats in multiple occupation) subject to mandatory licensing. The order is expected to come into force during 2017, subject to parliamentary approval. A 6 month grace period will be afforded to landlords to get used to the new legislation. Enable Finance provide HMO mortgages up to 85% loan to valuation happily consider more than 8 letting rooms. To read the full consultation paper written by the Department for Communities and Local Government click here