Live in half a house and rent the other half as an HMO?

Live in half a house and rent the other half as an HMO?

14:00 PM, 27th July 2020, About 3 years ago 4

Text Size

I have 2 properties I share ownership of and both of which are run as HMO’s. It does take more work and I have become something of a social worker, but as a business, it definitely has its good points re yield even with a small turnover of tenants.

I see live-in landlords and tbh that’s not for me, I like my own space and their cleanliness doesn’t do it for me either, I am the cleaner in ours.

I’ve googled this question without too much success, but maybe the knowledge is out there.

Where do you stand if you section off part of the house, for instance, the ground floor, and rent the upstairs?

One of our rentals is a large 7 bed with 5 en suites and 2nd kitchen upstairs to keep the facilities size to tenants in order. It seems if you sectioned the ground floor into a flat you would be segregated and could still rent the upstairs which would abide by all the regulations needed.

I was thinking more of a different property and location with some land which I couldn’t afford or justify by myself. It would be large enough for downstairs to be a good-sized flat and upstairs would pay for it.

Wishful thinking?

Even with lodgers, I would want to be segregated which isn’t the definition of a lodger so why not go all out and have more tenants. I would still be paying everything as an HMO just the HMO would be a 2 in 1 property.

Many thanks


Share This Article


Neil Patterson

14:03 PM, 27th July 2020, About 3 years ago

Hi Tony,

If your residential area is entirely self-contained could you create two separate leaseholds rather than complicate the issue?

Tony Clements

13:53 PM, 28th July 2020, About 3 years ago

Reply to the comment left by Neil Patterson at 27/07/2020 - 14:03Atm i am looking at property for the hopefully not too distant future, online only, and that includes land with the option to build to accommodate a layout that would work best for my plans, especially with en suites etc inc a downstairs shower. Are you suggesting 2 flats? The areas i am looking tend to be single, usually large, homes. I don't think flats would be given permission. If you mean to simply lease the top half separately but the residence remain one house with one set of utilities it could possibly work. Tbh I'm not sure where I am looking would accept an HMO in the 1st place but I'm thinking out loud and ready to take ideas and or tips. If I took in 2 lodgers to avoid the HMO hassle I don't believe I am permitted to "section them off" and them still be classed as lodgers. Although 2 tenants isn't an HMO as a seperate lease I presume it would be seen as a seperate residence and all rent taxable so you need 3 to equate to 2 lodgers and possibly council tax? If I could section 2 tenants off and they were still considered lodgers it would be the simplest option and not involve as many people/hassle to have to deal with ongoing. A 4 bed house with an en suite and a bathroom with one bedroom as a communal room and one as a kitchen isn't a bad deal for someone renting a room, and in a nicer area than usual shared homes. I only have me, and the dog, to worry about and a 1 bed ground floor "flat" is ideal when I have control of the neighbours above.

Chris Bradley

7:29 AM, 1st August 2020, About 3 years ago

In relation to your last comment, if you were in a seperate segregated flat the occupiers of upstairs would be tenants, and as well as the income taxation changes from lodgers you'd also have to let the tenants upstairs enjoy quiet enjoyment, so you would have no control over the upstairs tenants. They might become problem tenants and you'd have the same issues getting them evicted as other landlords but you'd have the added issues of having to live with the issues for over a year while it drags through the courts.

Tony Clements

16:28 PM, 10th August 2020, About 3 years ago

Reply to the comment left by Chris Bradley at 01/08/2020 - 07:29
That was my worry with tenants. I would be happier with 2 lodgers but if segregated they wouldn't be classed as such. As I am looking to build this property the separation of ground to 1st floor will be extremely well insulated. I only want to hear them. If not for age catching up I would live upstairs. I don't want to rely on a stairlift or such. My dog would also would miss easy access to the garden.

Leave Comments

In order to post comments you will need to Sign In or Sign Up for a FREE Membership


Don't have an account? Sign Up

Landlord Tax Planning Book Now