Two recent cases demonstrate the importance of landlords complying with the rules relating to houses in multiple occupation (HMOs). In an Edinburgh case the landlord was banned from the residential letting business because he had failed to give accurate information to the local council about his history. He had concealed criminal convictions and breaches of HMO rules when he applied for an HMO licence to rent out a flat.
In a case concerning let property in North London the judge ordered the landlord to pay more than £300,00 in fines, costs and penalties. He had illegally converted four properties into twenty-eight flats. He must also repay thousands of pounds of rent to the tenants. Those cheap landlord insurance clients who have been in the market for some time are probably aware of the HMO rules but newcomers to the business might welcome an introduction.
What is an HMO? The basic definition is that it is a property let as a main or only home to at least three tenants who form more than one household and who share a bathroom, kitchen or toilet. If you operate an HMO with three or more storeys that is occupied by five or more persons who form more than one household you will need a licence from the local council. Councils may also include other types of HMO in the licensing scheme so it would be worth checking with them.
Typical HMOs include bedsits and shared houses. Many have been created by converting existing houses but others may have been purpose built. The HMO rules are an attempt to ensure that tenants in such properties enjoy reasonable standards of comfort and safety. The first point of contact for anyone considering this area of the let property business should be the local council.