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Commercial Finance Network – Funding Made Simple
July 14, 2020

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hmo regulations

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Appeal launched over refusal of plans to increase rooms at Wrexham HMO

An appeal has been launched after a bid to increase the number of bedrooms at a house in multiple occupation (HMO) near Wrexham town centre was turned down.

Landlord Arran Pritchard applied to Wrexham Council in January to up the amount of bedrooms at a property on Poplar Road from six to seven.

However, the local authority issued a decision to reject the proposals after planning officers said there were not enough parking spaces outside.

Mr Pritchard has now submitted an appeal to the Planning Inspectorate in an attempt to have the outcome overturned.

In documents entered to support his case, he claimed most people living in HMOs don’t own a car, meaning the small increase would not cause a problem.

Highlighting a survey of the number of vehicles owned by tenants across the 23 properties he lets in the town, he said: “Here attached are two “vehicles per room” assessments, conducted in September 2015 and May 2016.

“They show that for 146 rooms/ occupants, there are just 17 to 25 occupants with vehicles, or one vehicle for every five rooms.

“This is largely due to all the rooms being in the town centre and tenants generally not being able to afford a vehicle.

“The planning application is to increase the number of rooms by the minimum possible, from six rooms to seven rooms. A comparable planning application, refusal, and successful appeal is the planning case for 33 Park Street, Wrexham.”

Mr Pritchard previously attempted to increase the total number of bedrooms at the property to eight but permission was denied on similar grounds.

Despite appealing the decision on the original application, a planning inspector appointed by the Welsh Government agreed with the council’s views.

In her decision notice, Siân Worden said she felt the proposals would impact on the safety of drivers at a busy junction.

She said: “The appeal property is in a busy area where there are widespread parking restrictions and many of the dwellings do not have off-street parking. There thus appears to be a high demand for on-street spaces.

“The proposed development would result in a small increase in the number of vehicles requiring parking spaces in the vicinity.

“Even so, it would increase the hazard on the local road network, and reduce its efficient use, by resulting in more drivers searching for a parking space.”

Mr Pritchard’s latest appeal will considered at a future date.

By Liam Randall

Source: Wrexham

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Landlords body tells city council that its plans for licensing could break the law

A major local authority has been warned that its licensing scheme could be in breach of the law.

Coventry Council updated its mandatory licensing scheme for landlords to include an accreditation regime.

Private landlords who are accredited can obtain longer HMO licences than those who are not.

The Residential Landlords Association has told the council it thinks this is unlawful because the only way for landlords to become accredited is to attend training courses in person.

The RLA argues that this discriminates against landlords who do not live close to their property in Coventry.

In a letter to the council, the RLA argues that this is unfair and unlawful because longer HMO licences offer a financial and practical benefit for landlords, yet only landlords who are members of the council’s accreditation scheme will benefit from being able to obtain a five-year HMO licence.

The RLA earlier wrote to the council raising concerns over the proposed fee structure in its additional and selective licensing consultation.

The RLA now has similar concerns about the mandatory HMO licensing fee structure.

As part of the scheme, landlords must pay the entire licence fee upfront, even if a licensing application is still pending.

The RLA considers this to be unlawful, given that a court case in 2018 ruled that licence fees should be split into two parts, the first part being an application fee and the second part being payable once the licence has been granted.

The RLA is now calling for the authority to review both the accreditation and licensing scheme as a matter of urgency.

David Smith, policy director for the RLA, said: “The RLA is deeply concerned at the serious legal questions that hang over the council’s licensing and accreditation scheme.

“We would strongly urge the council to review this unjust scheme.”

In May, the RLA wrote to Oxford City Council raising concerns that the council’s accreditation scheme breached EU law because landlords could only become accredited if they attended training courses in person.

Since then, the RLA and Oxford City Council have worked together to amend the accreditation scheme.

By ROSALIND RENSHAW

Source: Property Industry Eye

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Landlords and lenders need to be up to date with new HMO regulations

IN APRIL the Houses in Multiple Occupation Act (Northern Ireland) 2016 came into force. It brings the regulations for Houses in Multiple Occupation (HMOs) in line with the rest of the UK and imposes tough new requirements on landlords to avoid overcrowding in residential properties. It is a legislation that landlords, managing agents and lenders need to be aware of.

An HMO is a property in which three or more people from two or more different families live. It includes properties that have been converted into self-contained flats. Previously, it was the property that was the subject of the HMO Licence – and licences were granted by the NI Housing Executive, subject to certain works undertaken by the landlord to bring the property to HMO standards.

But this has now changed, and the responsibility for licensing is now passed to local councils. A landlord now must apply to register themselves as an HMO provider and must prove they are a fit and proper person to hold a licence and that granting the licence will not breach planning.

This regulation will impact landlords and managing agents across Northern Ireland, particularly those owning properties let to Queen’s University and Ulster University students at their various campuses and those intending to sell residential property portfolios.

Generally, the licence will be granted for a five-year period, but this can be shortened by the council. Licences are also subject to renewal and can also be revoked. An owner of an HMO must apply and have a licence before it can be used as an HMO and the council can refuse to grant a licence if it is not satisfied that the property has the relevant planning permissions. Though, if applications are revoked or refused, there is an option to appeal.

When ownership of a property is transferred, any existing HMO licence also ceases to have effect. This may cause difficulties for vendors and purchasers with properties being sold with existing tenants in sit. The onus will be on the purchaser to apply for and be granted a new licence as the landlord for each property it acquires.

If a property does not have the relevant planning, then a Certificate of Lawful Existing Use or Development (CLEUD) must be obtained to evidence planning, before any HMO application is made by a prospective landlord.

In order to make a CLEUD application, five years continuous use of the property must be demonstrated and proven. It will be important to have five years’ tenancy agreements and rental statements showing payments in this regard. In the alternative, a purchaser may lodge a planning application for change of use but given the over saturation of HMOs in certain areas in Northern Ireland, though there is no guarantee that planning will be granted and could be refused. This could leave a purchaser and a lender in a difficult situation.

Landlords can be prosecuted and fined if they are found to be operating an HMO without the appropriate licence and managing agents can also be prosecuted if they are complicit in the landlord’s activities.

It is therefore imperative proper advice is obtained from both a legal and planning perspective whenever a client is considering acquiring an HMO (and a lender is funding that purchase) – to ensure the property and the landlord do not fall foul of the new legislation.

Managing agents should also ensure their clients meet the HMO requirements when letting such a property on their behalf. This is a complex piece of new legislation and those dealing with residential real estate and HMOs, must familiarise themselves with it to avoid issues in the future.

By Alison Reid

Source: Irish News

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Introduction of new licensing scheme for Houses in Multiple Occupation

A new licensing scheme aimed at improving conditions for occupiers and addressing issues that can affect neighbourhoods will be introduced for Houses in Multiple Occupation (HMO’s) from 1 April 2019.

It will require landlords to meet important quality and safety standards before an HMO is let.

This regulatory regime will also be linked to planning, ensuring that the concentration of HMOs is managed.

Belfast City Council will manage the licensing scheme on behalf of all local authorities in Northern Ireland. More information is available on their website at www.belfastcity.gov.uk/nihmo.

Belfast City Council will also launch an advertising campaign to include online, radio and newspapers, to ensure landlords and tenants are aware of the change in responsibilities. It is intended that all local councils will share this messaging and information widely.

The licensing scheme will be managed by the NI HMO Unit based in Belfast City Council; they will process applications and enforce the regulations across NI, ensuring the terms and conditions of the licences are complied with by landlords.

The decision on whether to award a licence will be the responsibility of the local council in which the HMO is located.

The new system will work more effectively because HMO regulation will be linked to other critical functions, such as planning, building control and environmental health, all of which are under the responsibility of district councils.

David Polley from the Department for Communities said, “From 1 April 2019 Councils will be responsible for HMO regulation carrying out checks and inspections to ensure that the property is suitable for the specified maximum number of persons intending to occupy it.

“This is about improving the quality of this type of private rented accommodation and is something which should be welcomed by landlords, those living in HMOs and those living around them.

“Well managed multi-occupancy houses are an important part of the housing market in Northern Ireland. New licensing arrangements will mean councils will be expected to work with landlords and owners of HMOs to ensure flats and houses are safe and well maintained,” he added.

Source: Newry Times

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Landlords warned over housing rules as £16,000 fine dished out in

Warnings have been issued to rogue landlords in Wolverhampton after council officers issued a £16,000 penalty to a homeowner flouting the rules.

Wolverhampton council handed a Whitmore Reans landlord the huge financial penalty for running a house in multiple occupation (HMO) without a licence.

It is the first time the council’s housing team issued a civil penalty to a landlord for failing to abide by its rules.

Deputy council leader Councillor Peter Bilson said the case should serve as a warning to landlords across Wolverhampton.

The cabinet member for city assets and housing added: “This is a stark warning to private sector landlords that they must comply with the HMO rules in the Wolverhampton.”

The council said the fine, which will be reduced to £10,600 if paid in full within 28 days, signals the start of a tougher approach to managing private sector landlords.

Powers are now in place to enforce civil penalty notices of up to £30,000 per offence, and new licensing rules for HMO will come into force on October 1.

Government officials will bring in the changes to HMO licensing in a bid to improve standards of housing across the country.

Key changes will include needing to obtain licences for some properties occupied by five or more residents, living in two or more separate households and sharing amenities.

It will apply to single and two-storey properties, as well as purpose-built, self-contained flats in a block of no more than two self-contained flats.

Councillor Bilson added: “Through our Rent with Confidence framework we continue to work closely with private landlords across the city.

“It is important they are fully aware of the new government regulations that come into effect from October 1 and that we will be doing everything in our power to enforce them.

“Rent with Confidence supports responsible private housing businesses in the city and aims to improve the quality and choice of housing for private sector occupiers.

“We are here to advise landlords on the new changes and we will continue to work with landlords, agents, owners and service users by providing a range of information and guidance through the Rent with Confidence scheme.

“Providing further protection of health, safety and welfare rights for tenants in the city is vital.”

Last year, the council announced it would be extending enforcement powers handed to its officers so they could dish out fines of up to £30,000 to landlords breaking housing laws.

But the council may reduce the charge if rogue landlords agree to work to address issues.

They will need to agree to be registered with the Rent with Confidence scheme – a five-star rating system – and achieve at least a three star rating.

Source: Express and Star

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HMO Licence Rule Changes On The Way

HMO licence rule changes are on the way as the criteria for properties that need an HMO licence becomes broader.

At the present time you are only required by law to obtain a Houses in Multiple Occupation (HMO) licence if the rental property is:

1) Rented to five or more people from more than one household

2) At least three storeys high

3) Having tenants using the same facilities

Though individual councils are able to set further rules.

However, from the first of October this year, any property occupied by five or more people from two or more households will be considered an HMO, regardless of its height or the available facilities.

Anyone managing a property that is considered to be a House of Multiple Occupation needs to apply for an HMO licence.

HMO managers need to be considered a fit and proper person to hold an HMO licence.

The property will also be required to meet further safety obligations with regard to fire, gas and general safety, and the property must be considered suitable for the number of tenants living in it.

Minimum room sizes will also come into play in October. Bedrooms occupied by a single adult will need to measure a minimum of 6.51 square metres, while those occupied by two adults will need to measure 10.22 square metres or more.

Rooms slept in by children of 10 years and younger will have to be no smaller than 4.64 square metres.

In Scotland and Wales, regulations are slightly different. An HMO is any property rented by at least three unrelated people who share bathroom, toilet or kitchen facilities. Your responsibilities and obligations in Wales and Scotland for running an HMO may also vary.

In addition to the new HMO regulations introduced nationwide, many councils are introducing further landlord licensing schemes, so it is important for all landlords to check local regulations.

Source: Residential Landlord

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HMO licensing guidance for local authorities – and landlords

The Ministry of Housing, Communities & Local Government has today issued the document “Houses in multiple occupation and residential property licensing reform: guidance for local housing authorities.”
The guidance has been produced for local housing authorities, but is also intended to be of use for landlords.

Click Here to read the full document.

From 1 October 2018 any landlord who lets a property to five or more people from two or more separate households must be licensed by their local housing authority

This document has been prepared as a guide for local housing authorities to help them understand how to implement the reforms to houses in multiple occupation (HMO)licensing.

Under the Housing Act 2004, larger that are 3 or more storeys and occupied by 5 or more persons forming at least 2 separate households are required to be licensed.

With effect from 1 October 2018 mandatory licensing of will be extended so that smaller properties used as in England which house 5 people or more in 2 or more separate households will in many cases require a licence.

New mandatory conditions to be included in licences have also been introduced, prescribing national minimum sizes for rooms used as sleeping accommodation and requiring landlords to adhere to council refuse schemes.

Housing minister, Heather Wheeler MP, said: “Everyone deserves a decent and safe place to live.

“Today’s new guidance for landlords will further protect private renters against bad and overcrowded conditions and poor management practice.”

Source: Property118

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Massive extension to HMO licensing comes into force

CHANGES to Government rules mean a huge expansion in the number of HMOs requiring licences. Until this month an HMO (house in multiple occupation) only required a licence if it had three storeys and was occupied by five or more people, in two or more separate households while sharing kitchens/bathrooms.

The new regulations remove the three storey requirement, and Bournemouth council estimates it will have to license an additional 2,500 properties out of an estimated 3,000 previously unlicensable properties across the borough.

A report from the council’s private sector housing team to the communities scrutiny committee states that “2018/19 promises to be another exceptionally busy year”.

“The following key projects and service developments will be delivered,” the report says.

“The Extension to Mandatory HMO Licensing which could mean that the number of licensed HMOs will increase to approximately 2,500.

“The Housing and Planning Act has come into force which will bring further significant changes to our enforcement powers with Banning Orders for rogue landlords.”

Until April, council figures show there were 601 licensable HMOs across Bournemouth and Poole, of which 529 were in Bournemouth.

Bournemouth estimated there were 3,000 non-licensable HMOs in the borough, however in the past officers have often stated that it can be difficult to keep track of unlicensed properties.

Of these, 1,800 were believed to house students.

The new regulations bring in mandatory conditions relating to minimum sleeping room sizes, maximum number of occupants and provision of refuse facilities.

Licenses last for five years.

The private sector housing team, which among its duties is charged with ensuring landlords maintain their properties in good condition, dealt with some 2,600 service requests over the past financial year, according to its annual report.

There were 786 complaints relating to such issues as damp, lack of heating, lack of fire safety and overcrowding.

The team also lodged 11 prosecutions, and by the end of the year had three successes, through which some £2,300 was collected in fines and costs.

Also, the borough’s team has carried out an inspection of the nine mobile home parks in the area to ensure compliance with licence conditions. Together these parks house some 500 mostly elderly people.

One site, which is not identified, was prosecuted for non-compliance and the council collected £850 in fines and costs.

Source: Bournemouth Echo

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What do the new HMO regulations mean for landlords?

Last year the UK government announced plans to review regulations surrounding Houses in Multiple Occupation (HMO) although this was delayed by the snap general election. However, on 23 February 2018 the government announced details of changes to HMO regulations which will come into effect on 1 October 2018. While many of the changes are subtle they will force many landlords to apply for HMO licences and potentially fund changes to their properties.

SUMMARY OF HMO REGULATORY CHANGES

As of 1 October 2018 the following changes to HMO regulations will apply:

Definition of an HMO property

At this moment in time an HMO property is defined as one which is occupied by five or more people, forming two or more separate households and comprises of three or more stories. The new definition is much simpler and any property occupied by five or more people forming two or more separate households will require an HMO licence.

Floor space requirements

While the vast majority of HMO landlords offer floor space which is more than adequate for single rooms and those sharing, there have been many cases of bad practice highlighted in the press. As a consequence, the new guidelines will recommend floor space of no less than 6.51 m² for a single tenant and 10.22 m² for two adults sharing. At this moment in time it is unclear when this guidance will become law.

Properties previously exempt from an HMO licence

There are many HMO properties in the UK which do not currently require a licence under the old HMO definition. Those that fall under the criteria for the new HMO definition from 1 October 2018 will need to apply for a licence from their local authority. It is also worth remembering that a licence is required for each individual property as opposed to individual landlords.

Impact on landlords

Until the new regulations are brought onto the statute books nothing is actually set in stone but the indications are that around 170,000 additional properties will be impacted by the new HMO regulations. This is on top of the existing 60,000 properties already under licence. Those who fail to comply with the new regulations will be open to potentially unlimited fines.

Additional funding requirements

There is some debate at this moment in time as to whether the minimum room requirements will be guidance or firm regulations when the changes come in on 1 October 2018. It is likely that many landlords will at some point need to make changes to the layout of their HMO properties. Depending upon the type of property this could have a serious impact upon long-term rental income as well as requiring additional capital to fund changes.

PLANNING FOR THE FUTURE

At this moment in time the HMO changes will only relate to England although it is highly likely that Scotland, Wales and Northern Ireland will adopt their own form of regulatory changes in due course. We know for a fact that the definition of HMOs which require a licence will change and at some point the minimum room size guidance will become law. There is still plenty of time for HMO landlords to review their own individual investments and consider how the changes will impact their assets and their income.

Source: Property Forum

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HMO minimum room sizes to come into force 1 October 2018

The Ministry of Housing, Community and Local Government has published the expected regulations confirming that from 1 October 2018 HMOs licensed in England under part 2 of the Housing Act 2004 will be required to have a floor area no-smaller than 6.51 square metres.

Licenses issued from 1 October will have to contain the following conditions:

  • to ensure that the floor area of any room in the HMO used as sleeping accommodation by one person aged over 10 years is not less than 6.51 square metres;
  • to ensure that the floor area of any room in the HMO used as sleeping accommodation by two persons aged over 10 years is not less than 10.22 square metres;
  • to ensure that the floor area of any room in the HMO used as sleeping accommodation by one person aged under 10 years is not less than 4.64 square metres;
  • to ensure that any room in the HMO with a floor area of less than 4.64 square metres is not used as sleeping accommodation.

Where a breach is found to exist, local authorities will be able to grant a period not exceeding 18 months to rectify the situation.

Additionally, a condition will be included to mandate that landlords of licensed HMOs comply with any relevant local authority waste scheme – although no further details or minimum requirements are specified.

The full draft SI may be found here: The Licensing of Houses in Multiple Occupation (Mandatory Conditions of Licences) (England) Regulations 2018

Source: Landlords

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