Renting by the room: Understanding HMO Licensing

Property 118 - Published on 19/12/2012
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Renting by the room has seen a surge in popularity in recent years, as savvy landlords realise that yields for this type of tenancy are much higher than for plain vanilla lets. With the current housing crisis, and the dearth of lending for first time buyers, young people are priced out of purchasing their first property and are taking to renting for longer. With rents rising, shared housing is one of the few affordable ways to live in prime city centre locations.

Landlords who want to take advantage of these trends need to wise up about regulations. Renting a house or flat to a group of sharers is not as simple as renting to a couple or family, and with the introduction of the Housing Act 2004, some quite complex rules have been created.

One of the most misunderstood regulations is the licensing of HMOs.

HMO stands for House in Multiple Occupation, and the definition of an HMO can be quite baffling, let alone trying to understand whether or not you need a licence to create one. As councils tighten up on regulation of HMOs, as well as imposing planning permission requirements for HMOs in certain areas, it’s vital for landlords to get to grips with the law and how it applies to you. The effects of contravening planning law can be severe, and landlords can be fined thousands of pounds for failing to apply for an HMO licence.

Renting by the room - Understanding HMO LicensingAnyone renting to sharers should read SpareRoom’s HMO Guide guide as a first step. Their 8-page guide is a simple but authoritative explanation of HMO regulation.

SpareRoom helps you to work out if your property is indeed an HMO, if it needs to be licensed (N.B. not all HMOs need a license), and what you need to do in order to be compliant. It also explains why fire-safety precautions in HMOs are so important, and what measures landlords are expected to take to meet standards. Even if you think your property isn’t technically an HMO, this booklet is a useful way to check you’ve not missed anything important.

Download your free guide to understanding HMO licensing now



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