31:
294:
proper person" and there are annual inspections to check the property (2006 Act). Hostels and halls of residence for students or nurses are considered to be HMOs in
Scotland and the Scottish Government is considering extending the definition of an HMO. At the end of March 2019 there were over 15,600 licences in force and 87% of these were accounted for by the four major cities and the Fife local authority (Aberdeen, Dundee, Edinburgh and Glasgow). Edinburgh accounts for almost two in five of Scotland's HMO licences due to its higher rents, large student population, tourist lets and young professionals sharing.
311:, landlords can also reduce their exposure to loss of earnings through rental arrears or voids. While HMOs may generate higher income, HMO investments, at least in heavily regulated Scotland, entail significantly higher initial costs if compared with regular buy-to-let properties due to significant costs of licensing, safety checks and certificates, fireproofing, alarms, joinery and other required remedials.
285:
least one person is paying some form of rent to live in the property. New regulations came in to force in April 2019 and a new licensing scheme managed by local councils has replaced the centralised registration scheme. Landlords must pass a fit and proper persons test, fixed penalties have been introduced HMO managers have to adhere to a Code of
Practice.
331:
lenders refuse to finance HMO properties. This has led to the emergence of a specialised HMO mortgage market, catered for by a smaller subset of lenders. Because the choice of products is narrower, HMO mortgage borrowers are often subject to stricter criteria. Often they need larger cash deposits, as
293:
Scotland is a separate legal jurisdiction within the UK and all HMOs must be registered and must comply with certain standards and obligations. An HMO in
Scotland is a property that is shared by three or more tenants who are not members of the same family or household. The landlord must be "a fit and
284:
Northern
Ireland is a separate legal jurisdiction within the UK and all HMOs must be registered and must comply with certain standards and obligations. In Northern Ireland a property is an HMO if three or more people live in it, these people form at least three separate families or households and at
195:
HMO licensing was first introduced in
Scotland in 2000. To be granted a licence under the scheme, properties must meet certain standards, such as presence of smoke detectors and fire doors. These provisions were included in response to a fatal fire at a student flat in Glasgow, which had no working
138:
On 1 October 2018, the
Licensing of Houses in Multiple Occupation (Prescribed Description) (England) Order 2018 amended the large HMO definition in the 2004 Act by abolishing the "3 or more floors" requirement. Nevertheless, purpose-built flats in a block of three or more such flats, were excluded
244:
has been applied by a local authority, planning permission is required for the change of use of a dwelling house to HMO accommodation in the area designated. This is usually to protect the housing mix in particular areas of a city; for example in
Newcastle upon Tyne article 4 directives have come
186:
HMOs living spaces are often smaller but typically cheaper than a one bedroom flat. HMO agreements often include most utility bills with the rent. This is because it is difficult for landlords to apportion the cost of bills to each tenant fairly and it is also more appealing to potential tenants.
336:
is slightly lower than for an ordinary buy-to-let mortgage, while the minimum property value tends to be higher. Borrowers who are financing unlicensed HMOs may also be required to prove that their local authority has no intention to license the property in the future. It is also common for HMO
275:
Failure to apply for or comply with the terms of a licence for an HMO constitutes a criminal offence. Tenants may be able to recover up to 12 months' rent from an unlicensed HMO landlord. Since the
Housing and Planning Act 2016 (HaPA), tenants can make a Rent Repayment Order (RRO) application
92:
Legally compliant HMOs are characterised by a higher standing of fire proofing, after a series of deaths in overcrowded houses. According to the
Campaign for Bedsit Rights, three people a week died in fires in houses in multiple occupation (HMOs) between 1985 and 1991.
65:
Most HMOs have been subdivided from larger houses designed for and occupied by one family. Some housing legislation makes a distinction between those buildings occupied mainly on long leases and those where the majority of the occupants are short-term tenants.
134:
The
Housing Act 2004 introduced mandatory licensing for large HMOs which were defined in the Act as properties with five or more tenants forming more than one household sharing facilities such as kitchen, bathroom and/or toilets over three or more floors.
165:
This classification helps bring buildings with inadequate fire and safety regulations under the control of local authority (LA) inspection regimes. Section 257 HMOs are often expressly included in LA additional licensing schemes for HMOs.
276:
directly against the landlord and without waiting for the council to prosecute first (the situation under the Housing Act 2004 (HA)). Some tenants have been successful in recovering rent from landlords of unlicensed HMOs.
236:
HMOs do not need to be licensed if they are managed or owned by a housing association or co-operative, a council, a further education institute or student housing provider, a health service or a police or fire authority.
306:
investors because, it is believed, they have higher income-generating potential than ordinary or 'vanilla' buy-to-let properties. By splitting single properties into multiple bedsits that are each let out on separate
337:
mortgage lenders to levy stipulations on various aspects of the property, including the number of rooms permitted, the type of tenancy agreement and the type of locks installed on internal and external doors.
232:
Before 1 October 2018, there was an additional criterion that the building was three or more storeys. Landlords of large HMOs must apply for a licence and must comply with certain standards and obligations.
81:
are typically designated as common areas shared by all tenants, but contractually speaking common areas may also include stairwells, gardens and landings. Houses may be divided up into self-contained
1046:
199:
HMO schemes have been subsequently introduced to other parts of the UK, though the legal definition of what constitutes an HMO varies between Scotland, Northern Ireland, England, and Wales.
1079:
146:
have the power to introduce approved licensing schemes which include smaller HMOs as licensable. Typically these are for three or more tenants forming more than one household.
124:, which established a more complete and complex definition and also introduced the requirement for some HMOs to be subject to mandatory licensing (see below).
154:
The Housing Act 2004 (HA) introduced a classification of HMO under section 257 of that Act which includes self-contained flats in a converted block, where:
705:
984:
69:
The definition of an HMO has its origins in fire safety legislation, following a series of publicised, preventable deaths in overcrowded buildings.
1097:
761:
1027:"The total cost of an HMO investment in Edinburgh | Edinburgh Letting Centre | Letting Agents Edinburgh | Property Management | HMO Specialists"
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143:
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30:
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Some argue that HMO investment is necessitated by insufficient housing supply in the UK, whilst others argue that it is exploiting it.
807:
1005:
174:
The Council Tax (Liability for Owners) Regulations 1992 provide a different definition of HMO that is used solely for determining
1026:
106:
127:
The Housing Act 1985 was a consolidating act. The definition of HMO in section 345 HA85 was from section 129(1) of the
456:
939:
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308:
1119:
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Definitions of what constitutes an HMO and a household are set out in the law for each legal jurisdiction.
468:
985:"Houses in multiple occupation (HMO): consultation on adding new categories to the definition of an HMO"
368:
58:
term which refers to residential properties where 'common areas' exist and are shared by more than one
1085:
914:
886:
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472:
128:
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595:"The Civic Government (Scotland) Act 1982 (Licensing of Houses in Multiple Occupation) Order 2000"
256:
Depending on the region of the authority, they have some or all of the following powers, to vary:
545:
782:
727:"The Licensing of Houses in Multiple Occupation (Prescribed Description) (England) Order 2018"
616:
514:"The Licensing of Houses in Multiple Occupation (Prescribed Description) (England) Order 2018"
105:, as being "...a house which is occupied by persons who do not form a single household". The
17:
726:
513:
121:
102:
500:
488:
484:
55:
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116:"was originally constructed or subsequently adapted for occupation by a single household"
706:"Licensing multiple occupied housing: statutory guidance for Scottish local authorities"
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liability. Typically, the landlord is required to pay Council Tax on behalf of tenants.
82:
245:
into force in parts of Heaton, Jesmond, South Gosforth, Sandyford and Spital Tongues.
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362:
352:
328:
327:
Due to the additional legal requirements placed upon HMO landlords, many buy-to-let
1059:
253:
In England and Wales, local authorities manage and enforce the licensing of HMOs.
175:
78:
1060:"Buy to let HMO mortgages | Lender decision often within 2hrs of our call"
408:
390:
1047:
Buy-to-let: creating bedsits for 20pc returns is just a response to the market
358:
303:
202:
Generally, in the United Kingdom, an HMO has the following characteristics:
59:
142:
Apart from the statutory definition of HMOs requiring a mandatory licence,
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at least three tenants live there, forming more than one household and
346:
86:
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smoke detectors, and metal bars preventing escape through a window.
161:
less than two-thirds of the self-contained flats are owner-occupied
845:"We Spoke to the Legends Who Took Their Landlord to Court and Won"
209:
toilet, bathroom or kitchen facilities are shared between tenants.
120:
Both the 1985 and the 1989 Acts have since been superseded by the
29:
228:
toilet, bathroom or kitchen facilities are shared between tenants
225:
at least five tenants live there, forming more than one household
109:
expanded the definition to include any part of a building which:
571:"Tessa's Tenancy Agreements – where the landlord pays the bills"
678:"The new HMO regime in Northern Ireland – definition of an HMO"
361:, HMO or boarding house style accommodations for adults with
158:
the conversion did not comply with 1991 building regulations
955:
953:
940:"House in multiple occupation licence (Scotland) - GOV.UK"
869:"House in multiple occupation licence (Northern Ireland)"
808:"New rules protect home-sharing tenants in Southampton"
1082:
at the Department for Communities and Local Government
385:
383:
221:
A home is a large HMO if all of the following apply:
617:"Houses in Multiple Occupation: A Guide for Tenants"
365:
or children whose families can no longer handle them
546:"Are You Responsible For Paying Council Tax ?"
469:
Local Government and Housing Act 1989, s. 165(1)(c)
260:the minimum size of a property requiring a licence
639:"Students welcome tighter controls on landlords"
503:. Legislation.gov. Retrieved on March 30, 2015.
830:Flat Justice: Helping Tenants to Get Rent Back
748:"Rights and responsibilities in a shared home"
532:Flat Justice: Helping Tenants to Get Rent Back
27:British term for shared residential properties
1006:"Housing statistics 2019: key trends summary"
8:
491:. Legislation.gov. Retrieved March 30, 2015.
475:. Legislation.gov. Retrieved March 30, 2015.
459:. Legislation.gov. Retrieved March 30, 2015.
700:
698:
349:(they may share characteristics with HMOs)
915:"The new HMO regime in Northern Ireland"
654:
652:
409:"The lowest rung of the housing ladder?"
379:
113:"would not be regarded as a house" and
961:"Houses in multiple occupation (HMOs)"
742:
740:
738:
736:
909:
907:
597:. Office of Public Sector Information
107:Local Government and Housing Act 1989
101:HMOs were principally defined by the
7:
1104:Houses in multiple occupation (HMOs)
1080:HMO Licensing in England & Wales
783:"Heaton (HMOs & Tyneside flats)"
569:Shepperson, Tessa (9 January 2014).
25:
1086:HMO Licensing in Northern Ireland
139:from the amended classification.
528:"s257 HMOs: guide for landlords"
391:"HMO Guide from GetRentBack.org"
77:In HMOs, bathrooms and kitchens/
38:, some of which have become HMOs
1088:Northern Ireland Housing Rights
1049:. The Telegraph. July 25, 2014.
762:"Houses in multiple occupation"
843:O'Neill, Lauren (2019-04-02).
271:Penalties in England and Wales
266:the conditions of the licence.
1:
1098:Houses in multiple occupation
1092:Houses in Multiple Occupation
887:"The new definition for HMOs"
501:Housing Act 2004, ss. 254–260
395:Helping tenants Get Rent Back
355:, for HMOs in other countries
18:Houses in multiple occupation
44:house in multiple occupation
1094:at The Scottish Government.
787:Newcastle residential areas
415:. BBC News. 20 October 2015
52:house of multiple occupancy
1136:
1064:www.commercialtrust.co.uk
1008:. The Scottish Government
987:. The Scottish Government
708:. The Scottish Government
619:. The Scottish Government
764:. Newcastle City Council
485:Housing Act 2004, s. 266
457:Housing Act 1985, s. 345
302:HMOs are popular with
39:
645:. September 30, 1999.
575:The Landlord Law Blog
435:"From the archive..."
369:Student accommodation
33:
1106:at Shelter Scotland.
89:or simple lodgings.
1100:at Shelter England.
814:. October 20, 2015.
334:loan-to-value ratio
263:the licence fee and
242:Article 4 direction
550:The Tenants' Voice
309:tenancy agreements
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919:Housing Advice NI
891:Housing Advice NI
682:Housing Advice NI
660:"Private renting"
249:Local authorities
217:England and Wales
144:local authorities
87:bed-sitting rooms
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1030:. Retrieved
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923:. Retrieved
921:. 2019-04-01
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893:. 2019-04-01
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791:. Retrieved
789:. 2012-12-28
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686:. Retrieved
684:. 2019-04-01
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623:January 10,
601:January 10,
315:Controversy
176:Council Tax
170:Council Tax
1045:Dyson, R.
1032:2021-01-13
1012:2019-11-14
991:2019-11-14
970:2019-11-14
944:www.gov.uk
925:2019-11-14
897:2019-11-14
854:2019-11-04
812:Daily Echo
793:2018-02-09
768:2018-02-09
712:2019-11-14
688:2019-11-14
580:2015-10-22
555:2019-10-28
443:2019-10-28
419:20 October
375:References
359:Group home
304:buy-to-let
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240:Where an
191:Licensing
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1114:Category
643:BBC News
413:BBC News
341:See also
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289:Scotland
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489:Sch. 16
347:Hostels
323:Finance
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873:GOV.UK
664:GOV.UK
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Text is available under the Creative Commons Attribution-ShareAlike License. Additional terms may apply.
