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Property licensing

What is an HMO?

HMO is a term that is used to define accommodation that is owned by a private landlord and shared among a number of people. The acronym stands for a ‘House in Multiple Occupation’.

What is meant by the term 'Household?'

A household consists of one or more people who live in the same dwelling and also share meals or living accommodation and may consist of a single family or some other grouping of people. A single dwelling will be considered to contain multiple households if either meals or living space are not shared.

  • Married couples or couples living together as married

  • Relatives or half-relatives

  • Step-parents and step-children and half-relatives

  • Some domestic staff would be included in the household if they are living in the house as a result of the terms of their contract

LICENSING TYPES

Three types of property licensing

1. Selective license - compulsory for all let residential accommodation that is not an Additional or Mandatory HMO

2. Additional HMO (houses in multiple occupations) licenses - compulsory for properties occupied by 3 or more non-related occupiers that are sharing some basic facilities or amenities such as a kitchen or bathroom

3. HMO (houses in multiple occupations) licenses - compulsory for properties of three or more storeys, occupied by five or more persons living in two or more households

In order for a license to be issued we will need to be satisfied with the following:

1. That the proposed license holder and any manager of the property is "fit and proper"

2. That the proposed license holder is the most appropriate person to hold the license

3. That proper management standards are being applied at the property, including:

  • Gas and electrical safety

  • Gas and electrical safety

  • Maintenance of common parts fixtures

  • Maintenance of living accommodation

  • Furniture safety

4. That the HMO is reasonably suitable or can be made suitable, for occupation by the number of tenants allowed under the license with at least the minimum prescribed standards of amenities and facilities - these include the number, type and quality of shared bathrooms, toilets and cooking facilities.

Once granted the license must be clearly displayed within the communal areas along with the name, address and telephone number of the license or property manager of the premises. A copy of the current gas safety certificate must also be on display.

How can I check if a property needs to be licensed?

If you are not sure whether it needs to be licensed then contact the local borough council to check

Can a landlord evict a tenant to avoid licensing?

Landlords are not allowed to evict existing tenants in order to avoid licensing. ... Your council may take over the management of the HMO if it has clear evidence that your landlord is threatening to evict you to avoid licensing.

LICENSING REQUIREMENTS

Will the council take into account when deciding whether or not to grant a license?

  • The suitability of the HMO for the number of occupiers

  • The suitability of the facilities within the HMO, such as toilets, bathrooms and cooking facilities

  • The suitability of the landlord and/or the managing agent to manage the HMO (this is called the "fit and proper" test)

  • The general suitability of existing management arrangements of the property

The council also has to carry out a Housing Health and Safety Rating System (HHSRS) risk assessment on an HMO within five years of receiving a license application.

If the inspector finds any unacceptable risks during the assessment then the landlord will be instructed to carry out works to eliminate them. The landlord must also notify the council if they plan to make changes to an HMO (structural or decorative), if the tenants make changes to the property, or if the tenants' circumstances change (e.g. they have a child).

The council must ensure that a licensed HMO is not overcrowded and has suitable shared amenities and facilities for the number of persons occupying it. If there are too many people living in the HMO at the time the license is granted, the landlord must take reasonable steps to reduce the number of occupiers to the permitted number.

Existing tenants will not normally be evicted. Instead, when they move out, it will be an offence for the landlord to allow new tenants to move in if that would bring the total number of occupiers above the maximum number allowed.

ENFORCEMENT

What happens if a landlord doesn't apply for a license?

Operating an HMO that is not licensed will be considered as a Criminal Offence if convicted, the fines for non-compliance are unlimited.

In addition to this, the Local authorities also have a lot of ways on strengthening their power and may have the ability to revoke an HMO license

Rent repayment order. Under this order, landlords may have to pay back any rent to a tenant he/she received, or to the council any housing benefit they have received, for up to a maximum of 12 months.

Can a tenant withhold rent if the landlord has not applied for a license?

No, a tenant cannot withhold rent.

What happens if a landlord breaches the terms or conditions of the license?

There are instances that a license may be entirely revoked if the breach is serious or persistent.

What happens if the council refuses to grant a license?

If the council is unable to grant a license for an HMO then it will need to take over the management responsibility for the property until circumstances change and it can then be licensed. There are special rules that apply when a council takes over the management of an HMO

What happens if the conditions in an HMO are poor?

Whether or not the HMO is licensed it should be reasonably free from hazards that might affect a tenant's health and safety. The council is responsible for enforcing those standards and can require a landlord to take appropriate action to remedy any defects. In some emergency cases, the council may do the works itself.

MINIMUM SLEEPING ROOM SIZES FOR MANDATORY HMOS

Local authorities must impose minimum room sizes for any rooms used as sleeping accommodation as of 1st of October 2018.

The minimum standards applicable nationwide are as follows:

  • 4.64 m² for one child under 10 years of age

  • 6.51 m² for one person over 10 years of age

  • 10.22 m² for two people over 10 years of age

The ceiling height of the room should not be less than 1.5m because it will not be considered as a usable space. Minimum sleeping room sizes will apply to new mandatory HMO license applications. In due course, all existing licenses will also have to comply with these standards. Councils have the ability to apply larger room size standards within their area, but cannot set a standard lower than the above nationwide standards.

Property Fraud

Anyone can experience Property Fraud. This happens when fraudsters attempt to acquire ownership of a property either by using a forged document to transfer it into their own name or by impersonating the registered owner. Properties that are either vacant, tenanted, being refurbished or mortgage free is considered more vulnerable to fraud, as well as mortgage-free properties, but those with mortgages are still targeted.

Many homeowners will be unaware that information held with the Land Registry is available to view by anyone through the ‘Land Registry’ website. Unfortunately, this includes fraudsters, who can easily find out who owns a property, their correspondence address, lender details and even samples of their signature.

What can I do to protect my property?

You can protect your property by doing a couple of measures including:

  • 1. Registration of an Anti-Fraud Restriction on your property title

Through this, you can stop the ‘Land registry’ from registering a sale or mortgage on your property unless a solicitor or conveyancer certifies the application was made by you. Having a restriction also serves as a 'burglar alarm', deterring fraudsters when they are searching for properties to target.

Anti-fraud property alerts from Land Registry

Once your property is already registered with ‘Land Registry’, you can now sign up to their free property monitoring service. This means if someone applies to change the register of your property or if certain activities occur on your monitored property, you will receive an email alert. It could be a retrospective action if there is a delay in attending to the alert communication.

Take note of this:

This option will not automatically block any changes made to the register but will alert you allowing you to take any necessary action

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