Landlords letting to students need to be aware that they may need to obtain a licence from their Local Council to do so.
Houses of Multiple Occupation (or ‘HMOs’) are houses where 3 or more people, who are not related, reside in the same building and share the same amenities. Inevitably, the vast majority of HMO’s are, in reality, student let houses. HMOs are a different class use (C4) to regular dwelling houses (C3). As with all changes of class use to a building, the owner must first obtain a licence or planning permission from the local council. Failing to do so could result in a heavy fine. The change of use from C3 to C4 is not one of the exempt transactions to these rules, and therefore council approval must be obtained (currently the change of use from C4 back to C3 does not require a licence).
So why is this only now becoming an issue? The answer lies in the fact that the implementation of the licensing system for a 'C3 to C4 class use change' has been left to the individual councils, and therefore a few councils have still not implemented the system. However, many councils have now enacted these changes as a result of complaints from neighbours of ‘student let streets’. Basically, the need for a landlord to apply for a licence allows the council to keep an eye on the spread of student let properties.
The Council can also place its own restrictions on what a landlord must produce before a licence is granted, and therefore in theory the Council can ensure that:
- the landlord of an HMO is fit and proper
- each HMO is suitable for occupation by the number of people allowed under the licence (i.e. attempting to eliminate overcrowding)
- the standard of management of the HMO is acceptable
- vulnerable tenants can be protected
- high-risk HMOs can be identified and targeted for improvement
The implementation of the licence system is not retrospective, and therefore it is only new landlords who need to apply. If you are such a landlord, it is advisable to contact your local council to see if a licence is needed, and many councils now produce online leaflets detailing precisely what you will need to produce in order to obtain a licence.
Published on 12/10/2012