Changes – do you need a Licence?
Do you need a licence for your rental property?
The rules are changing and will be extant from 1st October 2018, by which time qualifying landlords will need to have applied for a licence!
If you may have five or more unrelated tenants forming more two or more households in a property, irrespective of the number of floors or if let under a single tenancy or if let as individual rooms – the new regulations will apply and you will need to obtain a Mandatory HMO Licence!
Agents and landlords need to determine if their rented properties will need an Mandatory HMO licence under new regulations.
The law for mandatory licensing changes at midnight on the 30th September 2018. Landlords must now apply for a mandatory licence if their property is occupied by 5 or more people, who form 2 or more households, regardless of the number of floors the property has. The regulation contains further details to apply when determining applicability of individual and blocks of flats.
There is no ‘Grace Period’ after midnight on the 30th September 2018 for landlords who now need a licence under the new regulations. Therefore, LA’s are making as many agents and landlords aware of these changes and providing information at this early stage to give people time to apply for a licence.
Agents and landlords responsible for HMOs that fall under the new definition stated within the new regulations (above) will be committing a criminal offence if they fail to apply for a licence or temporary exemption by the deadline. This could therefore result in a prosecution, which is liable on conviction to an unlimited fine. The other consequences of operating an unlicensed HMO are that it restricts using section 21 possession notices and enables tenants to apply for rent repayment orders to recover up to 12 months’ rent.
Agents and landlords must familiarise themselves with the new regulations where further information on licensing is required they are advised to visit their Local Authority website or contact their Private Sector Housing Team direct.
Rob. You do a great job keeping us informed of the seemingly constant changes to Regulations and requirements imposed on landlords and hence the extra costs.
On this one, Whilst I manage a five storey building, arranged as 5 self contained Flats, on behalf of the Freeholder Flat Management Company, two of the Flats are not managed by me, being under separate 3rd party ownerships. I am the managing agent for the other 3, which are each held under separate long leases by 3 individual owners (siblings) so each is a separate landlord, just of his / her particular flat.
Can you confirm that my reading of your covering Note and of the explanatory memorandum is that the Licensing Requirement does not apply in the above set of circumstances?
Dear JClive, apologies for not responding sooner.
For flats / apartments its a little complex and it depends on a number of details specific to your flats that I don’t know. I would recommend that you contact your local authority for their interpretation of your specific flats.
Properties (including individual flats) will be subject to mandatory licensing if they meet the following criteria:
It is occupied by five or more persons;
is occupied by persons living in two or more separate households; and
meets—
>the standard test under section 254(2) of the Act (https://www.legislation.gov.uk/ukpga/2004/34/section/254);
>the self-contained flat test under section 254(3) of the Act but is not a purpose-built flat situated in a block comprising three or more self-contained flats; or
>the converted building test under section 254(4) of the Act.
For flats, section 257 of the Housing Act 2004 applies (https://www.legislation.gov.uk/ukpga/2004/34/section/257). These are buildings that have been converted into and consist of self-contained flats where the building work undertaken in connection with the conversion did not comply with the appropriate building standards and still does not comply with them, and less than two-thirds of the self-contained flats are owner-occupied.
Easier to contact your Local Authority Private Housing Team to advise – they can be contacted via their website.