If you are a buy to let purchaser, then this article is aimed at you, even if you are not intending to use the property as an HMO (House in Multiple Occupation). It covers some of the key issues which you might wish to discuss with your conveyancer.
When obtaining a local search, your conveyancer could ask the local authority the following question:
‘Is the property a house in multiple occupation, or is it designated or proposed to be designated for selective licensing of residential accommodation in accordance with the Housing Act 2004?’
They could also raise relevant enquiries of the seller, such as:
‘Are the current living arrangements at the Property such that it requires a Housing Act Licence?’
- Mandatory Licensing of HMOs
Certain HMOs are required to be licensed under Part 2 HA 2004.
London Property Licensing provides examples of properties for which a mandatory licence would be needed, eg, shared houses and flats occupied by students and young professionals.
- Section 257 HMOs
A “section 257 HMO” is, in essence, a building that has been converted into and consists entirely of self-contained flats where the building work undertaken in connection with the conversion did not comply with the Building Regulations and still does not comply with them, and less than two-thirds of the self-contained flats are owner-occupied. Section 257 HMOs are not subject to mandatory licensing, but may fall under an additional licensing scheme.
- Additional Licensing under Part 2 Housing Act 2004
Where an area is for the time being designated by the local authority as subject to additional licensing, then any HMO in that area which falls within the designation would have to be licensed.
There are criminal offences in relation to licensing of HMOs under Part 2 include having control of or managing an HMO which is required to be licensed under this Part but is not so licensed; failing to comply with any condition of the licence; or knowingly permitting the maximum number of households or persons to exceed the number authorised by the licence.
- Selective Licensing, Part 3 Housing Act 2004
Most privately rented properties that fall within a selecting licensing scheme area need to be licensed by the local authority.
Criminal offences in relation to licensing of houses in a Selective Licensing Area include having control of or managing a house which is required to be licensed under this Part but is not so licensed.
- Licence Conditions
The local housing authority may impose conditions on the licence for the purpose of regulating:
(a) the management, use and occupation of the house concerned, and
(b) (in the case of Part 2 licences only) its condition and contents.
- Rent Repayment Orders (England only)
If a person has committed an offence being in control or management of an unlicensed HMO on (in an area of selective licensing) an unlicensed house (whether or not they have been charged or convicted); then (subject to conditions) application can be made to a tribunal by the local housing authority or a tenant, seeking a rent repayment order for up to 12 months of rent.
Article written and contributed by Stephen Desmond
DISCLAIMER: This article should not be regarded as constituting legal advice in relation to particular circumstances, and is merely a general comment on the relevant topic. If specific advice is required in connection with any of the matters covered in this article, please seek the services of a legal professional.