If you are a landlord you may consider letting your property to a group of students as this can produce considerably more income than letting to a single person or a family. However before you embark on this course of action you need to make sure you understand the laws covering 'houses of multiple occupancy' (HMO)
What is a HMO?
A HMO is any house or flat that is occupied by two or more households, is used as their main or only residence and where basic facilities such as kitchen, bathroom or toilet are shared. A household could be a single person, members of the same family living together or partners living together.
A HMO is regarded as a persons main or only residence if :
- it is their only residence
- they are living there as a full time student in further education
- the accommodation is used as a refuge from domestic violence
- it is occupied by migrant or seasonal workers
- it is occupied by asylum seekers partly or fully funded by the National Asylum Support Scheme
Do HMOs need a licence?
HMO must be licensed if they have three or more stories or are occupied by five or more persons forming two or more households. Local councils have the power to extend these rules to other properties.
What are the requirements to obtain a licence?
The local council must look at the following factors:
- the suitability of the property for the number of occupants
- the suitability of the facilities within the property
- the suitability of the landlord or managing agent to manage the property
- the general suitability of the managing arrangements
The local council must also set conditions in relation to the facilities in the property to ensure the safety of furniture and gas and electrical installations.
Are there any penalties for a landlord not applying for a licence?
It is a criminal offence to manage a HMO without a licence and if convicted a landlord can be fined up to £20,000
Are there any penalties for a landlord for breaching the terms and conditions of a licence?
It's a criminal offence for a landlord to have more occupants than the licence allows and they can be fined up to £20,000. If the conditions of the licence are breached then the landlord can be fined up to £5,000.