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Licence - homes in multiple occupancy

From 6th April 2006 mandatory HMO licensing will come into force across England. Landlords whose property is classed as an HMO should read on to find out what they need to do to prepare.

What is an HMO?

Under the changes in the Housing Act 2004, if you let a property which is one of the following types it is a House in Multiple Occupation:

• An entire house or flat which is let to 3 or more tenants who form 2 or more households and who share a kitchen, bathroom or toilet.
• A house which has been converted entirely into bedsits or other non-self-contained accommodation and which is let to 3 or more tenants who form two or more households and who share kitchen, bathroom or toilet facilities.
• A converted house which contains one or more flats which are not wholly self contained (ie the flat does not contain within it a kitchen, bathroom and toilet) and which is occupied by 3 or more tenants who form two or more households.
• A building which is converted entirely into self-contained flats if the conversion did not meet the standards of the 1991 Building Regulations and more than one-third of the flats are let on short-term tenancies.

In order to be an HMO the property must be used as the tenants' only or main residence and it should be used solely or mainly to house tenants. Properties let to students and migrant workers will be treated as their only or main residence and the same will apply to properties which are used as domestic refuges.

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Which HMOs need a licence?

Under the national mandatory licensing scheme an HMO must be licensed if it is a building consisting of three or more storeys and is occupied by five or more tenants in two or more households.

Local housing authorities have discretionary powers to widen the remit of licensing to also include other smaller HMOs if they think that enough of them in an area are badly managed.

If you are unsure whether an HMO needs a licence please read the information set out in this page. If you remain unsure, then check with the City Council.

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How do I work out how many storeys there are?

When counting the number of storeys in the building you need to include:

• basements and attics if they are occupied or have been converted for occupation by residents or if they are in use in connection with the occupation of the HMO by residents
• any storeys which are occupied by you and your family if you are a resident landlord
• all the storeys in residential occupation, even if they are self-contained
• any business premises or storage space on the ground floor or any upper floor

You do not need to count basements used for business or storage unless the basement is the only, or principal, entrance to the HMO from the street. Your local housing authority will be able to advise you, whether or not mezzanine floors should be included as separate floors in an HMO depending on their location and use.

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Is the licence per landlord or per property?

A separate licence is needed for each property.

The licence holder and the person who manage the property will have to be considered 'fit and proper' for the licence to be granted. A fee will be levied for each landlord and / or manager, to be considered 'fit and proper', however this charge will be required only once irrespective of how many individual properties require a licence. A separate fee will be set for each property. A licence may not relate to more than one property and is not transferable to a different property, or to a different person.

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What is the criteria for a licence to be granted?

In order to grant a licence for an HMO a local housing authority has to be satisfied of the following:

• That the proposed licence holder and any manager of the property is a fit and proper person
• That the proposed licence holder is the most appropriate person to hold the licence
• That proper management standards are being applied at the property
• That the HMO is reasonably suitable, or can be made suitable, for occupation by the number of tenants allowed under the licence with at least the minimum prescribed standards of amenities and facilities. These include the number, type and quality of shared bathrooms, toilets and cooking facilities.

The licensing application form contains questions which enable the local housing authority to decide whether or not the landlord and the property meet the criteria and can be given a licence.

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What are the minimum standards set for HMOs?

The Government has specified minimum amenity standards, setting out the requirements for kitchens, bathrooms and toilets in an HMO. Local housing authorities may use their own amenity standards if they are equal to or higher than the minimum standards. Standards covering room sizes, fire precautions etc. will be set locally. You should contact the local housing authority in which your property is situated to find out the standards you will have to meet. Standards to be applied to certain types HMO's are available below.

• Standards for Bedsits
• Standards for Shared Houses
• Standards for Hostels

HMO's that do not require a licence must still comply with the appropriate standards.

• If your property does not hold enough amenities for the number of tenants the local housing authority can either:
• grant a licence with conditions that extra amenities will be put in within a specified timeframe
• grant a licence for a smaller maximum number of occupants based on the amenities which are installed
• in properties with the worst conditions they may decide not to grant a licence at all if they cannot be brought up to required standards.

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Are there any other standards set for HMOs?

The Government has introduced revised standards for the management of houses in multiple occupation in new regulations, The Management of Houses in Multiple Occupation (England) Regulations 2006. They set down duties of both managers and occupiers. Details should be available via the ODPM website (see below).

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How and on what grounds will the council decide who is a 'fit and proper person'?

The application form will ask you about details of :

• Any unspent convictions you may have for offences involving fraud or other dishonesty, or violence or drugs or any offence listed in Schedule 3 to the Sexual Offences Act 2003
• Any unlawful discrimination on grounds of sex, colour, race, ethnic or national origins or disability in, or in connection with, the carrying on of any business
• Any contravention of any provision of the law relating to housing or of landlord and tenant law; (including any civil proceedings that resulted in a judgement against you.)

If you do not declare unspent convictions you will be committing a criminal offence and will be subject to a fine of up to £5000. There is also every likelihood that when this comes to light your licence will be denied or revoked.

Simply because someone has an unspent conviction for one of these offence does not mean that they will automatically be denied a licence. Each application will have to be considered on its own merits and the circumstances of an offence and its relevance to the licence application should be taken into account.

Your local housing authority can advise you if you are unsure about whether someone would be considered fit and proper to hold a licence or manage a property. More information is contained below.

• HMO Landlords info
• HMO Fire Precautions

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Where can I get more information on HMO licensing?

All applicants to submit Parts 1 and Part 3 of the licence application. Where an Agent or Manager is used, then Part 2 must be submitted. For applicants that own several properties subject to licensing, copies of Part 1 and / or Part 2 can be used for each property.

You must let certain persons know in writing that you have made this application or give them a copy of it. The persons who need to know about it are:-

• Any mortgagee of the property
• Any owner of the property to which the application relates (if that is not you) i.e. the freeholder and any head lessees who are known to you. Any other person who is a tenant or long leaseholder of the property or any part of it (including any flat) who is known to you other than a statutory tenant or other tenant whose lease or tenancy is for less than three years (including a periodic tenancy). The proposed licence holder (if that is not you).
• The proposed managing agent (if any) (if that is not you) Any person who has agreed that he will be bound by any condition or conditions in a licence if it is granted.

You must tell each of these persons :-

• Your name, address, telephone number and e-mail address The name, address, telephone number and e-mail address of the proposed licence holder (if it will not be you)
• Whether this is an application under Part 2 or Part 3 of the Housing Act 2004 the address of the property to which it relates
• The name and address of the local housing authority to which the application will be made
• The date the application will be submitted
• Before completing this application form please refer to the guidance notes supplied with this application form.
  

HMO Application Form - Part 1

HMO Application Form - Part 2

HMO Application Form - Part 3

For more general information on HMO licensing can be found on the ODPM web pages at

http://www.odpm.gov.uk/index

or contact the City of Durham Council for detailed information on licensing in your area.