New HMO Criteria

From 1st October 2018, the criteria for large Houses of Multiple Occupation (HMOs) will change. Currently rental properties with five or more tenants, that make up two or more households with three or more storeys are classed as large HMOs, requiring a local authority license.

However, the ‘three story rule’ will cease to exist come 1st October 2018. Therefore, if your property is rented to five or more tenants/occupants, that are not all one family*, you will need to apply to your local authority for a HMO licence before the tenancy commences, or before 1st October 2018 for existing tenancies.

There is one significant exemption to note: if the property is in a purpose-built block of flats, which contains three or more purpose-built flats, then the property may be exempt and you should check with your local authority.

*In this instance a ‘family’ means people who are married or co-habiting, or related e.g. siblings, grandparents, aunts, uncles, including step-parents or step-children.

Examples where a large HMO licence will be required

• A house is rented to five individual people who are not related
• A property is rented to two sisters, their husbands and a friend

Examples where a large HMO licence will not be required

• A property is rented to two parents and three children
• A property is rented to two brothers, their wives and a cousin

New Minimum Bedroom Sizes:

Some local authorities also operate selective licensing schemes, designating specific roads, areas or wards, where all rented properties must be granted a licence. From 1st October 2018, the government will introduce new minimum bedroom sizes for large HMOs or selective licenced properties. This is split into two categories:

Occupants aged over 10 years

• The floor area of any bedroom used by one person must not be less than 6.51 square metres
• The floor area of any bedroom used by two persons must not be less than 10.22 square metres

Occupants aged under 10 years

• The floor area of any bedroom by one person is not less than 4.64 square metres

All bedrooms are required to have a floor area of no less than 4.64 metres.

For any existing tenancies, where the property shall be deemed a large HMO under the new criteria, the landlord will have 18 months from 1st October 2018 to make the appropriate changes to the bedrooms or occupancy.

A HMO licence is granted by the local authority and usually lasts for five years. It will stipulate certain property safety criteria and conditions. For example, you may need to adhere to specific refuge disposal requirements, ensure the electrical appliances in the property have been tested, there are functioning smoke alarms installed and tested regularly and the property is managed by a ‘fit and proper person’. Often, local authorities will have their own additional requirements that you must adhere to.

Find more information about HMO licencing on the Government website here, or contact your local Chestertons office here.