The introduction of Mandatory Licencing came in 2016 through the Housing Act 2004. It applies to large houses of multiple occupation. The definition of a mandatory licence or property changed on the 1st October 2018 under the Deregulation Bill. In addition, please see previous article – https://harringtonslettings.co.uk/deregulation-strikes-again/
What is a House of Multiple Occupation?
The new definition now states it is as follows: –
1) Occupied by five or more persons.
2) Occupied by persons living in two or more separate households.
The standards to meet are:
- Standard test.
- self-contained test. It does not apply to purpose-built flats. This is subject to being three or more.
- the converted buildings test.
This applies to all HMOs with five or more occupants. However, this is not dependant on the number of storeys.
Selective license schemes will fall under the mandatory licencing scheme after 2018.
The existing selective licence will be valid until its expiry. The property will be correctly licenced up until that point. At renewal, the new mandatory licensing criteria will apply. The property will require a new license.
Does each Council have their own selective licencing scheme?
The answer is unfortunately yes and no. Some local authorities have now introduced their own licencing scheme. This is to raise the standard of properties. Each council has its own requirements. These can differ as they are selective licencing. It could be areas. It could be types of properties. Please refer to the government website regarding this – https://www.gov.uk/renting-out-a-property/houses-in-multiple-occupation-hmo
Do I need to check whether I need a licence?
Absolutely, yes. It is critical for you to check if a licence is required in your area. Contact your local authority to do this. Each authority will have their own licencing scheme. It is important you understand their requirements.
Will I need to carry out a gas safety, electricity report and PAT test?
Yes, these are all now compulsory. Electrical tests for instance EICR’s are required. These must then take place every five years thereafter. A PAT test (see our PAT testing article) needs to take place either yearly or every two years. This depends on the tenant ie whether a student or residential.
Does the local authority charge a fee?
Yes. A local authority will have their own scale of fees. Each licencing scheme is different. How long a licence lasts can differ between authorities. For example, some can be three years; some can be five years. Fees can range from £400 upwards. Speak to your local authority to find this out.
It has become much more difficult to obtain HMO licences with certain authorities. They not only require a licence but may also require planning. When purchasing a property, you should check with your local authority. Therefore, you will need to see whether it needs a licence or not. You need to check if it would be granted as well. Do I need planning? The law in this area is forever changing.