There are special rules that apply to the letting of houses where there are a number of individual occupiers who do not form members of the same family or household - these are known as houses in multiple occupation or 'HMOs'. HMOs typically include houses converted for bedsits flats or as a hostel. Estimates suggest that around 300,000 homes in England (excluding self-contained flats) are HMOs.
It is the current perception of Government that many of the worst housing conditions in the private rented sector are found in HMOs and that the risk of deaths or injury from fires in HMOs is often higher (especially in the larger multi-storey properties). Although this view has been to some extent discredited by research and fire incident statistics published by the landlords' associations, successive layers of special rules have now been introduced to control this type of housing.
Local authorities have powers to require landlords to bring HMOs up to a standard which is fit for the number of people living in the property. They may require the landlord to provide extra sanitary fittings, heating installations, facilities for storing, preparing and cooking food. There are also fire safety provisions that require there to be adequate fire precautions and means of escape. Grants may be available to the landlord to enable him to do the necessary work.
When managing, converting or acquiring an HMO (or potential HMO), there will be a number of issues to consider:
- HMO Definition: a landlord will need to firstly decide whether particular safety or planning legislation applies to the property.
- HMO Management Regulations - special rules apply to the management of HMOs. These put particular duties on both the landlord and the tenants.
- HMO Fitness Standard. The HMO Fitness standard (defined in s.352, Housing Act 1985) places requirements on landlords of HMOs to ensure that the particular house is fit for the number of people living in the property.
- HMO Registration Schemes. Many local authorities have implemented registration schemes which require landlords to register any houses in multiple occupation. A fee will normally be payable and in many cases, the authority will require that certain safety improvements are carried out or are already in place.
- HMO Mandatory Licensing. A new law was introduced in April 2006 under the Housing Act 2004 which requires certain HMOs to be licenced. This requirement applies to all local authority areas, and will initially apply to all HMOs that comprise 3 or more storeys AND have 5 or more occupants. Each local authority has the jurisdiction to set its own licence fees and make its own specific local fitness standards for fire safety, cooking facilities etc. that landlords will be required to follow.
- HMO Selective Licensing. Under the Housing Act 2004 local authorities have the power to introduce selective licensing of privately rented accommodation in areas where there is low housing demand and areas where there are anti-social behaviour issues which some private landlords fail to manage effectively. Landlords will need to check with the localy authority as to whether such a scheme applies and the requirements for that scheme.