Tessa’s Ten Top Tips on HMOs

  1. HMO stands for ‘House in Multiple Occupation’.  An HMO is any property where three or more people live in two or more ‘households’.
  2. It is not possible for a property with only two occupiers to be an HMO.  However  there are many HMOs with three occupiers.  For example a flat rented to three nurses.
  3. A household is basically a family unit – people related by blood such as a person’s children or siblings.  Two people living together as a couple count as one ‘household’ (including same sex couples) and households can also include employees who live with the family such as live in nannies and au pairs.  It has nothing to do with  eating arrangements or the type of tenancy agreement signed.
  4. All HMO properties need to comply with the HMO Management Regulations.  Some HMOs (but not all) will also need to obtain an HMO license from their Local Authority.
  5. From 1 October 2018 all HMO properties with five or more occupiers will need to obtain a license.  From that date the old ‘three stories’ rule no longer applies.  So a landlord of a bungalow with five unrelated tenants will need a license.
  6. Any type of occupation type can be an HMO.  So they can be  tenancies, or residential licenses plus also properties where people take in lodgers.
  7. As regards lodgers, a landlord can have two lodgers without needing to obtain an HMO license.  However if that landlord is himself a tenant and if the lodgers bring the total number living in the property to five or more – his landlord will need to get an HMO license.  This is why landlords need to be careful about permitting tenants to take in lodgers.
  8.  In some areas Council’s have introduced additional licensing requirements.  So landlords should always check this and not assume that they do not need any license (some selective license schemes apply even if the property is not an HMO).  On Landlord Law we are developing a Local Authority Directory to help you get answers on this.
  9. If you do not have a license when your property ought to have one you are vulnerable to being prosecuted and fined by the Council plus you will be at risk of your tenants (or the Local Authority if you have benefit tenants) applying to the First Tier Tribunal for a Rent Repayment Order.
  10. Landlords of licensable HMOs which do not have an HMO license are also unable to serve a valid section 21 notice.

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