There is a lot of confusion surrounding HMO properties and what is and isn’t allowed when it comes to renting an HMO property. Bellevue Lettings’ aim is to help both Tenants and Landlords understand the legislation behind HMO properties.
So, what is an HMO property? A home is classed as an HMO if there are 3 or more persons from 3 or more different families in residency. This is not limited to flats/houses as this also includes student accommodation and hostels. Basically anything that shares a toilet/kitchen/living area.
The owner of an HMO must have a license from the local authority where the property is situated. The accommodation must be licensed regardless of the type of owner e.g. private individual or registered social landlord. Should a Landlord purchase a property and wishes to go down the HMO route, they must submit their application along with displaying a notice outside the property advising they are wishing to obtain an HMO license. This then gives the public 21 days to object the license should they feel that an HMO property is not in their favour.
How long is a license valid for?
An HMO license may be granted for a maximum period of 3 years and no less than 6 months. This is dependent on the property state and whether or not the authority feels the property will be suitable under certain standards for whichever duration of time. There are some changes currently being considered on the term of an HMO license which we will mention at the end of this blog.
Getting your property HMO ready
When it comes to processing your application, there are many other authority officers that need to be involved along with other inspection officers. These could include Legal services, Landlord Registration, Environmental health, Planning, Building standards, Housing and Fire and rescue.
How much does it cost?
Depending on what works are required to get your property to HMO standards, it can be quite costly but definitely worth it. The fee per application covers Admin, Visits to the premises to authorize your application and in some cases, this could cover any necessary committee meetings to oppose/accept the license. The costs for obtaining your HMO license are as follows.
|5 or 5+ people||£627|
|5 or 5+ people||£440|
Is your property suitable?
There are so many HMO properties out there than many people would say is not suitable to let. This is why HMO licensing is in place; to provide safe, sufficient accommodation. Standards will vary depending on the type of accommodation. In general, the main factors HMO licensing must consider are as follows:
- The general condition of the property
- The type and number of tenants likely to occupy the property
- Have any rooms been subdivided or adapted which may affect the water/drainage pipes within the property.
- Safety and security
- The possibility of public nuisance.
Compliance and legal standards
Unlike a normal residential property, along with the usual regulations and requirements, HMO properties must abide by further rules and regulations. Some which include Space heating, Lighting, specified kitchen facilities and the space/layout of each room. You can find the full list at http://www.gov.scot/Resource/0038/00387514.pdf starting from section 4.6 onwards.
As a standard security measure, it is essential that the accommodation is made secure inside and out. Depending on the type of accommodation, individual rooms may require additional locks. These locks must be capable of being opened from the inside without using a key should there be an emergency and residents need to escape.
The main complaint facing HMO properties is noise. The steps to consider to avoid such complains would be to ensure good quality underlay for laminate and cushioned flooring such as vinyl for kitchens and bathrooms. This does not mean that properties are not allowed exposed stripped wooden flooring, these are just extra measures to consider to avoid a noise complaint.
The local authority can revoke a license at any time so it is important that you comply and stick to the guidelines at all times. Reasons to revoke a license may be that they feel the owner is no longer suitable (fit and proper) or that the accommodation is no longer fit for purpose.
The maximum fine for operating an HMO without a license (Both Landlord and Agent) is currently £50,000. This could also result in the owner being disqualified from operating HMO accommodation along with the agent for up to 5 Years.
It is also an offence for the license holder/agent to let the property whilst there are outstanding requirements. This and breaching any other license conditions can incur a fine up to £10,000.
Creating your lease
It is best advised to have separate tenancy agreements when it comes to an HMO Let where the occupants don’t know each other. This avoids confusion at the move out stage, especially when tenants move out at different times.
Otherwise, some landlords and agents grant HMO tenancies on a ‘Joint and Several’ basis. This means if any of the tenants default in payment for example, the other tenants are required to cover the debt. Should this be your favorable method, don’t forget to make this clear to the tenants when they are signing the lease.
In the News 2016
We always make sure you are brought the latest news and legislation. The most recent proposed changes will affect HMO licensing. The proposed changes are as follows:
- 3 year HMO licenses
- a new fee structure
- consultation arrangements.
Edinburgh Council ask for landlords to come forward and give any feedback by emailing them at firstname.lastname@example.org . Have your say!
In summary, it is always advisable that before obtaining an HMO license or buying a property with an HMO license and with intention of taking over that you seek professional advice. This guide contains only a fraction of the rules and requirements of operating an HMO license. When dealing with HMO properties, we work closely with the local authorities to ensure that these standards are being met. You can also contact HMO Scotland for advice and help with your application.