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HomeLet Landlord Blog December 15th
Tags: HMOs

What could HMO rules mean for landlords?

Posted on 2015-12-24

In early November, the Government announced a new set of proposals to contribute towards tackling overcrowding and poor quality accommodation in the Private Rented Sector (PRS).

The proposals include a new national minimum bedroom size for rental properties as well as redefining what accommodation falls into the category of a house in multiple occupation (HMO).

These proposed measures are the latest in the Government's concerted effort to tackle criminal landlords and are designed to complement the range of initiatives included in the Housing and Planning Bill, which is currently making its way through Parliament.

The Government guidance suggests that HMOs provide a cheaper form of rented accommodation, often for unrelated tenants who live under a single tenancy agreement. The briefing explains that in many cases these tenants are vulnerable – due to their age, lifestyle or immigration status. And that due to this vulnerability, some landlords take advantage of these circumstances by renting out 'sub-standard and dangerous accommodation'.

The paper and proposals, which were published on November 6, also cite a number of examples of exploitation of tenants in HMOs which have subsequently been reported in the national media. One of which is an instance in Willesden, North London, where a landlord was convicted for letting a small HMO – housing 16 tenants – without a licence. Another is a case of a landlord who did not provide adequate fire safety protection for their tenants at a two storey HMO comprising seven bedsits in Leamington Spa.

What are the proposals?

Minimum bedroom sizes

The new room size proposals have been put forward in response to a case in Manchester where an HMO bedroom was a lot smaller than the minimum standard set out by the local housing authority. The landlord won a reversal on the case against their property despite the bedroom in question being just 5.8 square metres.

The Government, therefore, wants to bring minimum sizes of HMO bedrooms in line with those already outlined in the Housing Act 1985 (Section 326), with the intention of making it a criminal offence to let out HMO rooms below these minimum standards. The proposal is for a minimum size of 6.5 square metres – just shy of 70 square feet – in a single bedroom. According to Letting Agent Today, the minimum size for a double bedroom is likely to be around 10.5 square metres.

Licensing of one and two storey buildings

The other principal proposal is to extend mandatory licensing of HMOs to one and two storey buildings. Currently, licences for HMOs are only required by law in properties with three or more storeys, where five or more people (in two or more households) with shared facilities reside.

Licensing extension for alternative dwellings

It is also proposed that this licensing is extended to 'poorly converted' blocks of flats, and flats above and below shops, which are often exempt under current legislation.

The Government says the idea of this licensing extension is to give councils greater powers and scope to target dwellings like converted garages and bungalows which are known to be used by criminal landlords.
It is stated that the Government's current view is that five people (in two households) is an appropriate number of tenants for the threshold to apply for smaller, high-risk HMOs.

What could this mean for landlords?

If these changes were to be introduced, the majority of landlords would be largely unaffected. However, it is still important to know the minimum bedroom sizes required and of course whether your property falls into the category of an HMO.

In some cases, a landlord may have to stop using a particular room as a bedroom because it is too small – which would mean letting to fewer tenants. On the whole, it would seem these are positive measures which, if effective, could help bolster the reputation of the PRS by limiting horror stories of overcrowded HMOs and unsatisfactory living conditions.

What happens next?

A consultation period ran between November 6 and December 18 with responses invited from landlords as well as local authority representatives. Comments and answers to the above questions were specifically sought.

It is now likely that it will take a few months for the consultation responses to be analysed before the Government makes public any changes to the proposals and confirms when it is going to implement these new rules. It does state in the Department for Communities and Local Government literature, that the Government intends to introduce these rules in 2016, while it also states that they will only be introduced in England in the first instance.

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