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The HMO Changes Landlords Must Be Ready for from 1st Oct 2018

From 1st October, 2018, several alterations are being made. According to these changes, the Houses in Multiple Occupation are licensable under changed circumstances. What are these changes? Let’s have a look.

Previously, only under the following conditions was a property required to have a mandatory license

·      The properties that consisted of three (3) or more storeys.

·      Properties that were occupied by five (5) or more occupants that were not related to one another.

In addition to these conditions for a mandatory licensing, the local authorities can also assign particular areas for additional licensing. This means that the House in Multiple Occupations would require a license regardless of the number of occupants and the storeys. In other circumstances, any rented property could require a licence regardless.

What Has Changed?

However, the mandatory licensing is changing beginning 1st October 2018, and The Licensing of Houses in Multiple Occupation Order 2006, is going to be replaced by the new one with the same name in 2018.

Under the new order, any HMO occupied by five (5) or more individuals who are not related to one another will require a licence. Hence, the three-storey element has been removed. This means the requirement is just according to the number of occupants regardless of whether the storeys are three, more than three, or less than three.

The new order also includes requirements, such as the room size, the area of the rooms and the property. For instance;

1.    A sleeping room for one adult must measure at least 6.51 square metres.

2.    Two adults should be no smaller than 10.22 square metre rooms.

3.    Children up to 10 years old must have an area of 4.64 square metres or more.

The licences must be applied for immediately for the renting out property to continue in a lawful manner. Some local authorities have incentivised the early adoption of the license by providing discounts for the early applicants. Similarly, discounts would be offered to the accredited landlords by some authorities, which would also be something worth looking into.

"The incentives are a welcomed, however this new law will be a huge increase in paperwork for councils, so do not be surprised if you're local council is not yet prepared or ready for the changes," says Nicholas A. Tsiougos, the Managing Director of London's Real Estate Brokerage, Stonelink International.

"However, if you are a landlord and have 5 or more tenants in the property, it is mandatory to apply for a license, as there will be no leniency or grace period with this new law. Penalties are severe and tough!", Nicholas goes on to add.

How do I find out more about this new law change?

It is very important to be prepared for what’s coming ahead, especially if you are a landlord with five (5) or more individuals renting your property. The government’s explanatory memorandum sets out the points in a simple and easy to understand manner http://www.legislation.gov.uk/uksi/2018/221/pdfs/uksiem_20180221_en.pdf

Alternatively, if you need more information and advice about how you could mitigate the impact of this new law and avoid fines and penalties, contact Stonelink International, London’s Real Estate Broker, for further assistance on + 44 (0) 207 993 4081 and by email info @ stonelinkinternational.com.

Stonelink International (London) Limited ©