5 Rules to Managing Houses in Multiple Occupation (HMO)

On top of your regular duties as a landlord to maintain a healthy, safe and compliant property for your tenants, landlords that let properties that come under the banner of Houses of Multiple Occupation (HMO) have additional responsibilities and rules to adhere to.

One household is defined as either a single person or members of the same family living together. This could be a married couple or relatives living together. If you rent your property to three or more tenants, forming more than one household, and they share communal facilities such as kitchens, bathrooms and toilets, then your property is considered an HMO.

If you have five or more tenants living there, forming more than one household, then this is considered a large HMO, and you’ll need to pay close attention to these five rules.

Rule #1 – Obtain a Proper Licence

If your HMO is large, with five or more tenants, you must have an HMO licence. Even if you have less than 5, you should still check whether you need a licence when renting out an HMO.

Licences are valid for a maximum of five years and must be renewed before they run out.

If you rent an unlicensed HMO that should be licensed, the fine is unlimited. So, make sure you’re clear on whether you need a licence.

Rule #2 – You Need to Implement Proper Health & Safety Measures

Make sure you’re meeting all relevant health and safety standards with this checklist:

• Fire risk assessments
• Clear, accessible escape routes
• Smoke alarms & fire extinguishers
• Keep proper documentation of all fire safety procedures
• Annual gas safety checks
• Check electrical systems at least every five years.
• Give new tenants a copy of the gas safety check record before they move in
• Keep communal areas and facilities in good condition with routine maintenance
• Conducting a routine legionella risk assessment and taking measures to maintain the water supply & drainage systems.
• Have your local council complete a Housing Health & Safety Rating System (HHSRS) risk assessment within 5 years of receiving your licence application.
• Carry out any work required after the HHSRS.
• Provide your tenants with relevant contact information and prominently display your name, address and telephone number within the property in case of emergency.
• Make sure all tenants are protected from injuries which may be caused by the design and structural conditions of the property.

Rule #3 – Avoid Overcrowding Concerns

The cost of overcrowding can be a costly compliance issue.

Rule #4 – Report any changes to the Council

Always tell your local council if you make any major changes to your property or if your tenants make any changes. For instance, if one of your tenants has a child.

Rule #5 – Inform your Broker

It’s extremely important to let your broker know if your property is operating as an HMO. If you don’t, any claims you make for your property could be considered invalid.