For many landlords the agree spectre of changes to mandatory HMO licencing has been a topic of consideration for a few months now, as the UK government announced proposals, but without clarity around what the new regulations could look like.
The wait is now over, and the new regulations were announced on 23rd February with clear requirements and the timeline for implementation which will be 1st October 2018.
Current Legislation For Mandatory Licencing of HMO’s
Mandatory licences for HMO’s are designed to ensure the safety and wellbeing of tenants within shared accommodation.
Larger HMO’s currently fall under the requirement for mandatory licencing as set out in the Housing Act 2004. The mandatory licence applies to all HMO’s which fall under the following criteria
1. Comprise 3 or more storeys
2. Are occupied by 5 or more people living in two or more single households
3. The occupiers share amenities such as a kitchen.
While mandatory licencing is a nationwide requirement, there are currently also areas where a selective licence is in place for properties which do not fall into the categories above, they are discretionary and cover certain local areas.
The New HMO Changes 2018
The upshot of the changes is that the definition of an HMO has been extended. The need for more than 3 storeys has been abolished and therefore any property which is occupied by 5 or more persons, living in two or more households will need to obtain the licence.
The new rules will also apply to purpose built flats where there are up to two flats in the block and one or both are occupied as an HMO.
What Do the New HMO Mandatory Licencing Rules Mean For Landlords?
Whereas existing mandatory licencing applies to around 60,000 properties the new roles are likely to affect many more – and it is estimated that around 175,000 properties could fall under the new scheme.
If a landlord does not currently have a licence as their property does not fall under the current definition, they will need to apply for one.
They may also need to make adjustments to their property to meet with their local authorities HMO standards, which can cover bedroom sizes, facilities and number of bathrooms.
The penalties to landlords who do not get a licence are extremely serious. Fines under the Housing Act are unlimited, ad in addition, local authorites are able to issues civil penalty notices of up to £30,000 per offence as an alternative to prosecution.
Selective HMO Licences and the New Mandatory Scheme
Many local authorities require licences for properties which fall outside of the mandatory scheme, and landlords may already hold this type of licence. The government’s response paper has confirmed
that properties which are already licensed under local authority schemes can be ported into the mandatory scheme.
What Should I do Next?
If you believe that your property falls into the new category for mandatory HMO licencing, get in touch with your local authority straight away to apply for a licence. Where your property is fully managed by Student Haus we will need to complete part of the application form so please contact us and we will make the necessary arrangements for you.