The Government has confirmed that the extension of mandatory HMO licensing is due to come into force form 1st October 2018, subject to Parliamentary approval.
The regulations bring purpose built flats where there are up to two flats in the block, into the scope of mandatory licensing. They also remove the three storey rule -at present mandatory licensing applies to HMOs of at least three storeys and five occupants comprising of two or more family units.
How will it affect me?
Research from RLA PEARL has found that 16% of landlords rent to people in HMOs. It is estimated that an additional 177,000 HMOs will become subject to mandatory licensing in England as a result of this extension.
Properties 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
- the standard test under section 254(2) of the Act;
- 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.
The Order, which can be read here applies to HMOs in England, but does not apply to converted blocks of flats, to which section 257 of the Act applies. 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.
Six month grace period
There would be a grace period of six months to give landlords time to comply and local authorities time to process licences.
The RLA believes many of the changes are unnecessary and says they will put a huge strain on local authorities. The Association made its points in its formal response to the Government consultation.