HMO Licensing

What is a House in Multiple Occupation? How does this change the letting and regulation process? Why are HMO subjects to this extra legislation? In order to clean up housing standards in the UK, HMO dwellings are being heavily targeted because they have been found to offer some of the poorest standards of accommodation. This ibuytolet guide clears up the details of the HMO license for the convenience of the buy to let landlords who owns, or is looking to own, and HMO.

Are you required to buy an HMO license?

HMO rules and regulations for buy to let landlords

HMO stands for a House in Multiple Occupation. By this, the government means one of the following letting situations:

An entire house/flat let out to 3 or more tenants, forming 2 households and sharing a kitchen and bathroom.

A house converted into bedsits with 3 or more tenants, forming 2 households and sharing a kitchen and bathroom.

A house converted into flats that are not completely self-contained, with 3 or more tenants, forming 2 households and sharing a kitchen and bathroom.

A building converted entirely into flats, if the conversion does not meet with the standards laid out in the 1991 Building Regulations, and over 1/3 of the flats are on short-term lets.

HMO properties are used solely or mainly to house tenants.

Some of the worst standards of housing in the UK may be found in HMOs. Under new laws, if you own and let an HMO property, then you must apply for and be granted a licence in order to let your house out. The aim of introducing HMO licensing is to improve the standard of amenities and management in this type of dwelling. HMO dwellings have been recognised as being badly managed and in poor condition.

Your local authority will grant HMO licenses, on the condition that the house you are renting is suitable for occupation. If the property does not meet minimum requirements (a certain level of facilities for washing, cooking, showering, etc.) then the local authority may impose conditions or refuse a license. Furthermore, the local housing authority will only issue a license to those houses that are managed by someone deemed competent.

The HMO license will therefore guarantee tenants a certain standard of dwelling. Practises such as rent undercutting and poor quality accommodation will become less common. Having a license should help landlords, through support from housing authorities and proof of quality accommodation.

The HMO license brings together current landlord registration schemes from around the country. The aim of the HMO license is to tighten up legislation, making responsible landlords licensed and making life more difficult for rogue landlords.

Different types of HMO license

Changes to the Housing Act 2004 have introduced three different types of licensing for use by housing authorities in the UK. These are as follows:

Mandatory HMO licensing

Additional HMO licensing

Selective HMO licensing

HMOs that have 3 or more storeys, and are occupied by five or more persons forming two or more households are legally required to be licensed by 6^th April 2006. In some cases, housing authorities will choose to introduce additional licensing. In order to do so, the housing authority will need to consult with local landlords and publicise their rules. In some areas of low housing demand or anti-social behaviour problems, housing authorities may also introduce selective licensing. This means that all rented property in this area, whether HMO or not, will need a license. Again, they must consult with local landlords and publicise their rules.