New HMO laws come into force
This guest post from Garratts Solicitors looks at what the recent changes in HMO laws mean for agents.
New HMO regulations have come into force from the beginning of this month, with the intention to “protect private renters against bad and overcrowded conditions and poor management practice.” The rule changes change the definition of what is considered an HMO, it also increases the minimum floor size of bedrooms.
The changes, which came into force on October 1st, mean that landlords who are found to flaunt the rules or do not apply for a licence can be fined any amount of money, according to the discretion of the court. Local councils have already imposed fines against some property owners. The National Landlords Association (NLA) has warned that the changes will mean that some tenants face the possibility of eviction, while others will see their rent prices rise.
A House of Multiple Occupation (HMO) is a property where two or more families, consisting of a total of 5 or more people, share amenities like a toilet or kitchen, but have their own bedrooms.
Previous rules dictated that a property must have three floors or more before it was considered an HMO and required a licence, but the three-storey requirement has now been removed, and smaller properties are considered part of the regulations. According to the government, this change alone will mean that a further 160,000 properties will be affected by the changes, and the landlords and letting managers need to ensure that they have received the proper licence from their local authority.
Room Size Requirements
One significant change to the rules is an increase in minimum room size requirements. The required room size is determined by the number of people sleeping in the room, and their ages., but no single bedroom can be smaller than 4.64 square metres:
- 1 person aged over 10 needs a room more than 6.5 square metres in size.
- 2 persons aged over 10 must have a room larger than 10.22 square metres.
- 1 person aged under 10 must have a room no smaller than 4.64 square metres.
Other Legal Requirements
There are other legal requirements that HMO landlords must also adhere to. For example, a gas safety certificate must be issued every year, and requires that a Gas Safe Registered Engineer check the gas equipment, including flues and pipework. Gas and electrical equipment also needs to be repaired and replaced, landlords need to ensure that communal areas in the property are properly maintained. This means ensuring that damage is repaired, hazards and potential hazards are removed, and that the areas are kept clean. Any new boiler and other gas equipment needs to be at least 86% efficient.
It is also a legal requirement that smoke alarms and carbon monoxide alarms are fitted, where necessary and in high risk rooms.
Fire safety regulations must also be adhered to. Check with your local authority to determine the exact requirements, but landlords will usually have to ensure there are safe emergency fire exits, that blankets and extinguishers are put in place, and other regulations are met.
The landlord, or letting agent, must complete “right to rent” checks on tenants. This ensures that they have the right to live in the UK and have the right to rent property. The landlord or agent must also be shown to be a suitable person to rent out property, which typically means that they do not have a criminal record and have the right to manage an HMO.
Under the new legislation, all HMO landlords must have a licence for their property. This applies to the landlord of any property with two or more family units, totalling five or more people. While it was once only necessary to obtain a licence for properties on three or more storeys, this stipulation has been removed, and a licence is required for properties with any number of floors.
Even if there are fewer than five people living in the accommodation, you may need to acquire a mandatory licence, but this will depend on your local council. Check with the local planning authority to determine your exact requirements and to help make sure that you don’t fall foul of local bylaws and regulations. The potential penalties for failing to have the proper licence are considerable, so should be avoided where possible.
You will need a licence for every HMO property that you own, regardless of the number in your portfolio. Each licence will last for a maximum of five years, and you will need to renew each licence before the deadline expires or you could face investigation and a potential fine.
Fines And Action
Spot fines of up to £30,000 can now be applied, removing the need for local councils to take court action. Higher fines can be applied, but these will require that the council take the landlord to court.
Local councils have the right to investigate any property or landlord that they believe fails to meet the appropriate requirements. Previously, the maximum fine that could be handed down depended on the offence, but the maximum fine for offences under the Housing Act 2004 was capped at £5,000, with a £20,000 cap for unlicensed HMO properties. Under the new regulations, this cap has been removed and there is no maximum fine amount. Failing to get the appropriate licence could land you with a substantial fine.
In September 2018, a rogue agent and two letting companies were hit with a combined £60,000 fine for running what was described as a dangerous and unlicensed HMO in West Hampstead. In October, a Worthing landlord received a £22,000 fine after the local council discovered five people living in dangerous conditions in an unlicensed property.
Garratts Solicitors is an experienced conveyancing law firm and can represent clients that believe they are living in unlicensed HMO property. Call with any questions, or visit their site, to see the full list of personal and business legal services offered by Garratts.