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Government forcing landlords to house non-paying tenants for lengthy periods
11:18 AM, 15th September 2020About A week ago 39
HMO planning and selective licensing
Make Text Bigger Property investors find the complicated rules that govern licensing and planning for shared housing – legally termed a ‘house in multiple occupation’ or an ‘HMO’ – a nightmare to navigate.
The result is many landlords unwittingly breach the law.
The problem is HMO licensing and planning can come down to a micro-managed level that means a property on one side of a street is subject to draconian restrictions, while an identical property opposite is not.
Two of the most common problems are explained below:
Does an HMO need planning permission?
This is one of those ‘it depends’ answers…
Converting a family home/residential property in to an HMO generally does not need planning permission providing a change of use or major structural change is not involved.
A change of use would be converting a non-residential building in to an HMO.
A major structural change generally involves adding an extension or loft conversion, or altering the outside of a property.
The law about HMOs and planning changed three times in 2010.
- Until March, no planning permission was required.
- Between April and September, planning permission was required for any new HMO.
- From October, planning permission is only required for HMOs in neighbourhoods where the council has imposed selective licensing.
Selective licensing is allowed under Article 4 of The Housing Act 2004.
Under selective licensing, a council can take on an extra power that requires all new HMOs in the area defined under selective licensing to apply for planning permission.
Do HMO tenants have to sign separate agreements?
Many landlords wrongly believe only a home converted in bedsits is an HMO and a shared house with three tenants who sign an assured shorthold tenancy agreement is a standard buy to let.
This is not correct. The Housing Act carefully defines an HMO in excruciatingly complicated legal terms that have been added and redefined by later court cases and legislation.
The overwhelming inference from all this legal discussion is the nature of the building and the relationships between the people that live there make a property an HMO, not the type of tenancy agreement that may be in force.
HMO advice
Property investors involved with HMOs should take specific advice from a local professional as HMO rules vary from council to council.
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About A week ago 39
Westminster online tool encouraging HMO tenants to claim Rent Repayment Orders!
9:10 AM, 27th August 2020About 4 weeks ago 33
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10:33 AM, 14th January 2011
About 10 years ago
I am taking advantage of the goverments chang in planning October 2010 when change of use from the planners was no longer required. Many councils are putting proceedures into place to close this door. The property is a large 5 bedroomed terraced house in a residential area, it has three floors but has no cellar. I requested a visit from the private sector housing officer and we discussed the criteria of the licence. We will be licencing for 6 persons, using the seperated dining room as the 6th bedroom. The house has a large communal lounge, a dining kitchen with adequate worksurface and cupboards for 6. We have added a second cooker. The utility is large and contains a second sink and drainer with two further fridge freezers. The property has three bath/shower rooms in which two have toilets and a third toilet is seperate, which for an HMO required a small hand wash. There was an existing fire escape and over time we had replaced windows to fully open to fire standards. All of our properties are certified every 5 years for electricity and yearly for Gas. A full fire alarm and emergency light system has been fitted and commisioned. Fire extinguishers and fire blankets have been placed and commisioned. We had previously replaced doors with fire doors, fire hinges, intravescent strips and fire closures. A fire assesment has been commisioned and I am deemed to be a person of suitable character to be a licence holder.
Why go to all that trouble? The figures add up. The current rent on the property is £750 pcm. As an HMO for 6 people there payment will be £125 per week. This does however include all bills (not phone).
We also do a clean through once a week, which also is vital to maintain a high standard and receive feed back. Also meter readings can be taken weekly and concerns actioned.
The final result is a property with a value of £120k as a residential property earning £9,000 per annum
Or as an HMO earning £36k less expenses (£9k) = £27,000 per annum.