Confusion about HMO definition?

Confusion about HMO definition?

14:16 PM, 29th June 2022, About 2 months ago 4

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Hi All, I will soon become a property owner and I wanted to rent out two rooms to help with the mortgage and bills.

I live in Croydon (where full planning permission is required for any kind of HMO) I must be careful to not hit the threshold for an HMO. By looking at the Croydon’s council page https://www.croydon.gov.uk/housing/landlords/houses-multiple-occupation-hmo it seems that the house is considered an “HMO” if:

“at least three tenants live there, forming more than one household”

I will live in the property with my wife, and I am confused as to how this will play with the definition of HMO and I wanted to ask an opinion to confirm that my interpretation is right.

By how I interpret the writing above, I will be the owner so I don’t qualify as a tenant, my wife will be a permitted occupier, so she doesn’t qualify as a tenant. In addition to us both, I will be able to rent to 2 additional people without becoming an HMO. Renting to 3 additional people rather than two will trigger the threshold for an HMO.

Did I understand the rules right?

Thank you very much in advance for all the help!
Manuél

Croydon Overview:

A house in multiple occupation (HMO) is a house or flat where both of the following apply:

  • at least three tenants live there, forming more than one household
  • the occupants share toilet, bathroom or kitchen facilities with other tenants

A household is either a single person or members of the same family who live together.

An HMO could be a:

  • house divided into bedsits with a shared kitchen and/or bathroom
  • shared house or flat where the tenants do not occupy it as a typical family would or where the sharers are not members of the same family
  • house converted into self-contained flats
  • hostel
  • bed-and-breakfast hotel that is not just for holidays
  • hotel or accommodation being used as a hostel to house a group of people with a common need, usually on a short term basis – for example homeless people, unaccompanied minors, asylum seekers, ex-offenders, and semi-independent living schemes
  • shared accommodation for students/employees/friends – although many halls of residence and other types of student accommodation owned by educational establishments are not classed as HMOs


Comments

Neil Patterson View Profile

14:20 PM, 29th June 2022, About 2 months ago

Please check with Croydon, but this sounds like a Lodgers agreement to me if I have understood correctly?

David Smith

15:37 PM, 29th June 2022, About 2 months ago

I would say if you are living in the property then it is not an HMO.
You can also earn £7500.00 tax free from renting a room out in your home.

Jerry Stone

16:10 PM, 29th June 2022, About 2 months ago

Reply to the comment left by David Smith at 29/06/2022 - 15:37
I would concur with David.

It cannot be an HMO if you are living there.

He is also correct the first £7,500 received is not

required to be declared to HMRC under the room

rent scheme.

Ian Narbeth View Profile

16:23 PM, 29th June 2022, About 2 months ago

Reply to the comment left by David Smith at 29/06/2022 - 15:37
I don't think it is correct that it cannot be an HMO if you live there. Haven't had time to research but Spareroom say:

"It's a common misconception that the HMO regulations only apply to flatshares where the landlord doesn’t live in the property – it's perfectly possible to have an HMO as a live in landlord too.

You’re allowed to have two ‘non family’ members before your property is classified as an HMO, but when you get to three non-family, paying lodgers, it’ll change. It doesn't matter if the lodgers are related to each other or not – the rule is around forming two or more separate households"

at https://www.spareroom.co.uk/content/info-landlords/will-taking-in-a-lodger-turn-my-home-into-an-hmo/

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