Convert to HMO or not?

by Readers Question

13:26 PM, 2nd February 2021
About 3 months ago

Convert to HMO or not?

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Convert to HMO or not?

I have a reasonably good-sized mid-terrace property coming vacant. In the past, I let this to families.

The ground floor of the house has a large front room, large mid-room and a large kitchen. Upstairs there are two medium-sized bedrooms, good-sized box room (8ft x 6ft) and bathroom, there is also a loft room with a window which in the past has been used as a bedroom.

I am wondering whether to convert this house into an HMO with a room in the front room, Mid-room and kitchen as communal areas and two or three rooms upstairs. If I decide to go ahead, would I need to inform my lender?

Any thought or comments would be appreciated.

Mike

Comments

Yvonne Francis

16:01 PM, 6th February 2021
About 2 months ago

If you took this question further you would certainly have to look towards your Council, online or direct advice. There are others who have posted about the large number of requirements, especially fire precautions, licensing, and possibly planning.  You certainly would not be able to rent the box room as there is a national standard of 6.51 square meters a tenant is allowed to sleep in, as well as size standards for communal rooms and number of bathrooms. Your box room is 4.42 square meters. It would have to be locked and specified as such in the lease. Leaving it for storage is problematic in case your tenants allow another person to occupy this room, so exceeding the number you are allowed. There is also a height requirements for space to count so that would may be doubtful and complicate the fire precautions. 
Mike says you are responsible for Council Tax and utility bills. However this is not necessarily the case if you let as a shared tenancy, under a Separately and Jointly liable lease, and they come to you as a group. This is by far the easiest way and in my personal opinion, the happiest way to let a HMO and makes insurance easier. 
I let to students as I'm in a University town. They make very good tenants. I'm not as doubtful as Jessie over students requiring accommodation and opting for online study, presumably she means at home? Don't forget there has been online learning by the Open University for years but still students stream into our universities. They want the experience of living away from home as well as the contact with staff and other students. In fact when I marketed my student houses last November I have never had such a demand for them, with lots of student groups attempting to ensure a good property for the next academic year, and desperate to avoid University provided accommodation in their second year. As one student agreed with me, being locked into one's room with a beefburger bought up for lunch was not what they signed up for! Last summer at the end of the tenancy, although the house had been in lockdown for over half of the tenancy, my students said how much they enjoyed the house when they left. After Christmas some of my tenants were coming back earlier in case of restrictions on travel. Hope I'm not being too optimistic!

Yvonne Francis

17:12 PM, 6th February 2021
About 2 months ago

In regards to my post above, sorry I meant Jointly and Severally liable lease.

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