If you’re renting out your property to multiple tenants, your property may be considered a HMO, which means ‘House in Multiple Occupation’.
Why is this important to know? Having an unlicensed HMO is an extremely costly misjudgement for landlords to make, so here’s everything you need to know about your property if it is home to multiple tenants.
What kind of property can be classed as an HMO?
To run a compliant HMO, it’s vital to understand exactly how the government and your local authority define HMO. Your property is classed as a HMO if it:
- Is home to at least three tenants, forming more than one household
- Also has a shared toilet, bathroom, or kitchen facility for all tenants to use.
The key thing to note is the specific numbers. If your property is home to two tenants who are unrelated, it is not classed as a HMO. For the premises to be a HMO, there must be at least three unrelated people living in it.
When is licensing required?
If your property is a HMO and occupied by five or more unrelated tenants, it must have a licence. However, bear in mind that every local authority is different and your local council may also require additional licence, even if you only have three tenants.
What happens if a landlord does not have a compliant HMO?
Landlords who have not taken the time to research HMOs can put themselves at huge risk. In fact, your local council can issue fines of up to £30,000 for each breach of the rules, so they aren’t to be taken lightly.
Taking out specialist HMO insurance
HMOs are thought to be higher risk properties, so traditional landlord insurance will not provide adequate coverage for these homes.
Specialist HMO insurance can protect you in the event of unforeseen circumstances like a flood or fire, as well as protection against liability claims and damage to the property.
Before taking out insurance for your property, make sure that you have registered the home’s address as a HMO with your local council first. Failing to do so could jeopardise your insurance coverage.
Related: The ultimate guide to property management
Knowing your additional legal responsibilities as a HMO landlord
Understanding the ins and outs of your responsibilities is the best thing you can do to ensure that your jobs as a HMO landlord runs smoothly. Non-compliance with HMO regulations could not only land you in trouble with the law, but also could pose a risk to your tenants’ health and safety.
Additional responsibilities for HMO landlords include:
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Obtaining an HMO licence.
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Providing tenants with adequate provisions.
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Complying with additional fire safety regulations.
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Adhering to overcrowding standards.
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Providing adequate refuse disposal facilities.
How a letting agent can help
With the ever-evolving regulations and stringent licensing requirements, navigating the complex world of HMO management can be overwhelming. This is where a letting agent comes to the rescue. Their expertise in HMO legislation, certification, and safety standards can save you from costly legal complications and penalties.
Letting agents are well-versed in the latest changes to HMO regulations, and they can help you with the paperwork, property inspections, and tenant vetting, leaving you more time to focus on other aspects of your life.
For more advice on government legislation, get in touch with us today.
