Legal advice required on Scottish HMO issue

Legal advice required on Scottish HMO issue

20:53 PM, 19th February 2013, About 9 years ago 14

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Legal advice required on Scottish HMO issueI own a flat in Scotland which my daughter lives in along with two rent paying flatmates. 

I have a difference of opinion with a council housing officer as to whether the flat has to have an HMO or not.

I believe that under the legislation I do not need to have an HMO as my daughter is invisible for the purpose of counting whether there are three different family individuals in the flat.

The council official states that unless my daughter is a part owner of the flat she counts towards one of the three different family individuals. Needless to say the paperwork available can be interpreted both ways

If you are aware of the Legislation in Scotland I can refer to I would be most grateful.

All the best,

Stephen Foster




by Mark Alexander

21:00 PM, 19th February 2013, About 9 years ago

Hi Stephen, I don't know the answer to this one but I'm sure the Scottish Association of Landlords will. Please see >>>

Hopefully somebody will post the answer here as it's useful information to others who may be in the same position too.


21:16 PM, 19th February 2013, About 9 years ago

I would suggest this is likely to fall within the remit of an HMO....the Housing (Scotland) Act 2006 says any living accommodation requires an HMO Licence where it is occupied by 3 or more unrelated the council official has said, if the daughter was a joint owner, then they would be occupying with two other unrelated people which could fall within one of the exceptions under s126...however if the daughter is not a joint owner, then this exception won't apply. Hope this helps...

by Mark Alexander

21:32 PM, 19th February 2013, About 9 years ago

@ Fiona - would the daughter have to be recorded on the title deeds at HM Land Registry (apologies for my ignorance if you have an alternative in Scottish Law) or would beneficial ownership suffice?

Presumably, if the latter would qualify then you or somebody else at TC Young could draw up a Declaration of Trust which would resolve the issue without the need to involve mortgage lenders etc. and this would also be far more cost effective than HMO licensing?

by Mark Alexander

8:06 AM, 20th February 2013, About 9 years ago

A lady called Pamela Johnstone has posted the link below over on our Facebook wall which does seem to confirm the advice provided by Fiona Greer of TC Young Solicitors.

I will be very interested to hear back from Fiona as to whether my suggested restructure of beneficial ownership would avoid the requirement for HMO licensing though as I suspect several Scottish landlords will be in a similar position.

Please come back to us Fiona, you may end up getting a fair amount of work out of this for your firm if it can be done 🙂


9:34 AM, 20th February 2013, About 9 years ago

You would reuqire to transfer part of the title of the property to your daughter...this deed would require to be recorded in the Land Register, the effect then being that you and your daughter would be joint owners of the property...the transfer of part of the title needn't be for any conisderation (ie for no price)...if your daughter was then living in the property, this could fall within s126(a) of the Act in that the HMO could potentially be exempt from the requirement to be licensed where an owner occupies the property together with other persons who are unrelated to them, but who are members of either the same family, or of one or other of two families...I don't do conveyancing, lovely colleagues in our property team would be happy to give you some further sepcific advice on this process...if you want to email me on I am happy to assist furher with this.

by Mark Alexander

9:58 AM, 20th February 2013, About 9 years ago

How would this affect the rights of a mortgagor Fiona?

I appreciate that you might not be able to say if you're not a conveyancer but it would be really useful to find out.

It was the potential for mortgagee complications which lead to my suggestion of a Declaration of Trust. Please ask your convenancing colleagues to comment on this.


10:02 AM, 20th February 2013, About 9 years ago

Hi there all

I see our good friends at TC Young have beaten us to the reply here. If you'd like to get in touch with SAL Stephen we have a factsheet on this issue but since you won't need it now for this issue we do have info on many other useful topics for Scotland's landlords!. We work closely in partnership with TC Young. One of the benefits to SAL members are some discounted fixed fee services there by virtue of their SAL membership. Also as a member you can attend training sessions free of charge and ask all your letting questions to trainers including from TC Young and our own in house experts. We also have a member helpline and advice by email service which answers questions like this daily. If you need any assistance please do let us know.

All the best from the Scottish Association of Landlords


10:24 AM, 20th February 2013, About 9 years ago

Any mortgage over the property would require to be in names of those who appear on the title...the proprietors would both be jointly and severally liable for the debt and both would enter the personal bond element of the Charge to repay the loan to the creditor...If the lender was satisfied that together the title holders can meet the obligations of the loan then there should be no issues....problems could arise if one of the title holders has a poor credit score or other credit issues.

by Mark Alexander

10:49 AM, 20th February 2013, About 9 years ago

Agreed, hence my suggestion of a Declaration of Trust to split the beneficial interests in the property as opposed to changing the legal title.

Is this possible in Scotland and if so, how would this impact upon the HMO regs?


10:55 AM, 20th February 2013, About 9 years ago

The 2006 Act is quite clear in that it talks about "owners" occupying the property, in relation to whether an HMO Licence is required or not...the owners of a propery are defined as per the there would require to be a transfer of part of the title in order to fall within this particular exemption.

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