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Property Licence

From the 6th of April 2006 a mandatory property licence will come into effect for houses in multiple occupation (HMO). Any landlord which rents a property classed as a HMO should read further to find out more information about what they need to do to prepare for this change. This licencing is being put in place to raise the standard of accomidation for those living in HMOs.

Do I own a house in multiple occupation?

If you own or manage a residential let property in England which is occupied by three or more tenants (where at least one of them is unrelated to the others) which share a kitchen, toilet or bathroom then the chances are you own a house in multiple occupations and will be effected by the new property licence regulation!

How long do I have to get a HMO property licence?

The new property licence scheme will come into compulsory effect from 06/04/2006 but there will be a three month grace period for landlords to arrange their licence(s). Failure to apply for and arrange your licence within this time scale could result in penalties such as fines.

What is a house in multiple occupation?

The housing act of 2004 states that any property which is let under the following circumstances is considered as a house in multiple occupation:

HMO property licence advice for landlords

Why is compulsory licensing being introduced?

The government are introducing compulsory property licences for any property considered to be a house in multiple occupation because they feel such properties are often poorly managed and are left in a bad condition of repair which is creating inappropriate living conditions within England. The new licence will ensure that landlords which let a HMO property will meet standards or be penalised if they fail to do so.

How are landlords being made aware of the change in law?

The commencement date for the HMO property licence regulations is 06/04/2006 and in the run up to this date the government will be launching extensive advertising campaigns such as advertisments on radio and local newspapers.

I already have something similar running with the local council...

Some landlord registration schemes are already in operation which are ran by local housing authorities but these were set up under older legislation and do not mean that you will not need to abide by the new HMO property licence rules. The new scheme created by the government has been setup to provide one clear policy with regards to the renting of properties to multiple occupations.

Why are the government only targetting houses in multiple occupation?

The government realise that landlords which let properties in multiple occupation usually provide a low cost alternative for people such as students and those with financial hardness and have noticed significant differences in the condition of HMO properties compared to properties let in circumstances such as a two storey house let to one working family. For example many consider HMO properties to suffer from the following issues:

What is considered a self contained portion of accommodation?

Self contained means a portion of accommodation which has its own private use kitchen (or other cooking area), bathroom and toilet. If the tenant occupying the property needs to leave this portion of accommodation to access such facilities then it isn't considered as self contained.

What does the government consider as a household?

Under the guidance of the 2004 Housing act the following would be considered a household:

For example four friends sharing a let property would be considered as four seperate households. If there was a married couple sharing with a friend then this would be considered as two households.

How do I know the number of storeys my property is considered to be?

When working out how many storeys your property is considered to have you should remember that attics or basements used for accommodation are counted as a storey along with any other storeys occupied by a tenant. If a basement is used purely for storage then you do not need to count it as a storey for the purposes of the new licence regulations.

Example of property storey count

Which parts of the UK will be effected by property licence rules?

The 2004 housing act will only affect England and Wales. Scotland and Northern Ireland have their own property licence schemess in operation already.

As a landlord will I need just one licence or a seperate licence per property?

You will need a licence for every HMO property which you own or manage. To qualify for a licence you must be considered a fit and proper landlord and your properties must meet the new requirements put in place to protect tenants.

What is the basis requirements for a property licence?

How long will an application for a HMO licence take?

The application process time will depend on several factors such as the circumstances of your property and the amount of applications the local housing authority has to deal with. As long as you have submitted a valid HMO application then you should be able to continue operating as usual until the local authority has processed your application.

Is the HMO licence scheme known under any other names

Officially the scheme is known as the HMO property licence but many landlords have been known to refer to the scheme as the following:

Will my HMO licence last forever or will I need to renew it?

A HMO property licence will usually last for upto five years before it requires renewal.

How much will a HMO property licence cost me as a landlord?

The cost of the licence has been left in the hands of your local housing authority, however to remain fair the pricing structure will be based on actual costs of maintaining the licence scheme and not structured in a way to generate profit for the local council. The ownership of the licence for your property does not mean you will obtain cheaper landlords insurance because it is a compulsory licence which will be expected as standard if required.

Are property licences just a money maker for the council?

This is not the case, all money raised from this scheme will go torwards covering the costs of the scheme and not for any other purpose.

Costs of updating properties to meet HMO property licence regulations

The government understand that it can be expensive for a landlord to improve their properties to meet the new requirements which is why some local housing authorities may make funding available to help landlords carry out the work required to make their properties comply with the new regulations.

Will my properties be inspected by the local housing authority?

In most circumstances a inspection will not be required however some local authorities may choose to make inspections on a property before accepting a licence request for the property. Refusing to allow them to inspect the property may result in your licence application being denied.

Who does the council consider to be a "fit and proper" person?

When applying for your property licence you wil be asked for details on any unspent convictions you may have which involves fraud, any form of dishonesty, violent, drugs or any offence listed in schedule 3 of the 2003 sexual offences act. Any unlawful discrimination with regards to sex, colour, ethic origins, national origins or disibility within the course of your business. If you fail to disclose any unspect convictions when applying for a HMO property licence then you will be breaking the law and subject to a fine of upto £5,000, failure to disclose such a fact which then comes to light may result in your application being instantly denied. If you are looking for employers liability insurance in the UK then we recommend the use of an insurance broker to ensure you make the best choice. Having one of these unspent convictions does not mean that your application will result in a denied HMO application because the local authority will take each application on its own merits and decide what is the most appropriate outcome.

What happens if I do not register for a licence?

Failing to apply for a property licence for a HMO property will be considered a criminal offence and can result in a fine upto £20,000.

Is this website an official resource for the HMO property licence scheme?

This website is not a government run official resource for the new property licence scheme, it has simply been setup to provide free advice to landlords with regards to the new legislation being put into place by the government. Any text on this website should be treated as a general guideline only and if you rely on any information here you do so at your own risk. You can find accurate information on the official website which is ran by the government or by contacting your local housing authority.

Is there an unbiased body I can appeal to about property licensing?

If you wish to appeal against any aspect of the HMO property licence scheme you can appeal to a residential property tribunal which will hear your case and decide on a suitable outcome.

HMO property licence advice for tenants

Does my landlord need to have a property licence?

If you are in doubt whether your landlord should have a property licence in place for their property you should read the guidelines outlined above, generally any property which is made of of three or more storeys and occupied by five or more different people (making up two or more households) then it will need to be licensed by your landlord.

How will the new property licence regulations for HMO properties effect me?

The new scheme has been setup to improve the living conditions for tenants in HMO properties, you may see that your living conditions and the general maintenance of the property is improved as a result of the new rules. A knock on effect of the new rules may be that your rent increases as landlords try to recover the cost of meeting new HMO property licensing regulations and the improvement of their properties. Another bad effect may be that less landlords are able to meet the high requirements of the new regulations and therefore withdraw the rental of their properties ultimately causing housing problems.

How can I find out if my landlord has a licence for the property I live in?

The 2004 housing act says that a copy of a register which outlines licence holders must be made available at a central office such as the local housing authority building which must be available for inspection by the public at reasonable times (for example within working hours).

Should I worry if my landlord is not licensed?

If you believe you are living in a HMO property which is being managed by someone who doesn't hold a valid property licence then you should contact your local housing authority who will be able to advise you on what will happen next and try to resolve the issue with the property manager. In the mean time you can point the person which manages the property in the direction of our landlords property licence page which can help make them aware of the requirements should they be unaware of the new legislation.