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Bath Landlords Fined For Operating HMO Without Licence

Two Bath private landlords have been told that they must pay more than £16,000 due to their failure to obtain the correct House in Multiple Occupation (HMO) licensing.

Elizabeth Vowles, 48, and Hayley Book, 55, both from Weston pleaded guilty at Bath Magistrates’ Court to their licensing failure, deemed an offence under the Housing Act 2004.

The court was told that the two landlords had been caught operating a pair of HMOs in Bath’s designated Additional Licensing Area without the adequate licensing. Their flouting of the regulation was discovered in January 2017, despite the fact that it had been a legal requirement in certain locations in Bath since 2014. The licensing scheme was introduced to enable officers to know the location of HMOs and place conditions on the landlord to enforce minimum standards of safety, as well as making sure that the property’s management is maintained.

The pair of private landlords were also managing a third HMO in the Additional Licensing Area, so both landlords would have been well aware of the additional licences that were required for houses of multiple occupation licensing, the court was told.

Vowles and Book were each fined £4,000 for each property. They were also ordered pay prosecution costs of £550, as well as a victim surcharge of £170. In the Bath designated licensing area, operating a property without a licence is an offence punishable by a fine up to £20,000

Councillor Paul Myers commented on the case: ‘Our Housing Services will try to work in partnership with landlords to improve housing standards wherever possible. Additional licensing helps to ensure that occupants of HMOs are able to live in safe and well managed properties. Where landlords fail to licence their properties such as the case here, they are undermining the objectives of the additional licensing scheme.’

Source: Residential Landlord

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Fresh eviction fear for residents after council refuses Willenhall HMO plans

The saga over a former warehouse which has been used for housing without permission for more than two years has taken another twist after planning chiefs refused plans to make it legitimate.

Tenants have been living in the premises at 51 to 53 Wolverhampton Street, Willenhall, which is now a house of multiple occupation, since at least 2015.

Last year Walsall Council took enforcement action against the owner Jim Haliburton effectively evicting the residents, but the move was put on hold after he formally submitted an application to ‘change the use’ of the building retrospectively.

Now the authority’s planning committee has refused the proposal and is considering enforcement action once again, meaning residents face fresh eviction fears.

However it may not be the end of the lengthy dispute if Mr Haliburton contests the latest decision.

A council spokeswoman said: “This application was refused for lack of shared parking, limited bin storage and poor outlook for residents all impacting detrimentally on amenity.

“The planning file will now be passed to the Planning Enforcement team who will commence work on taking action to cease the use of the building as a HMO.

“This action though will need to be placed on hold if the applicants appeal to the Planning Inspectorate in Bristol in an effort to overturn the decision to refuse planning permission. If the appeal is dismissed, officers will press ahead with enforcement action.”

Earlier this month Mr Haliburton appealed the council’s decision to turn down planning permission for another of his properties in Butts Road, Walsall, in a very similar dispute.

Source: Express & Star

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Another dent to landlords’ profits

Renting out a house as a multiple-occupancy let can be very lucrative, allowing landlords to rent out rooms on an individual basis rather than via one tenancy. However, government plans to crack down on the sector are about to make this type of investment less attractive than it once was.

The Department for Communities and Local Government published a consultation paper on houses of multiple occupancy (HMOs) last October, setting out its plans to “raise the standards”. The rules are expected to come into effect next spring, later than expected (probably because of June’s surprise general election). But despite the fact that thousands of properties could be affected by the government’s proposals, as many as 85% of landlords are still unfamiliar with the proposed changes, according to a survey by Simple Landlords Insurance.

One of the main aims of the legislation is to widen the definition of properties that require a licence to be legally let. At the moment, a property is classed as being a HMO if three or more people from more than one household live there, and share toilet, bathroom or kitchen facilities. Currently, only houses that are classed as “large HMOs” – properties rented to five or more people (from more than one household) – and set over three or more storeys, need to have a licence. However, the new legislation would mean that all large HMOs – regardless of the number of storeys – would require a licence. The government also plans to extend mandatory licensing to flats above and below business premises. Currently around 60,000 HMOs across the UK require a licence, but the government reckons that a further 174,000 properties will need a licence if the rules come in.

Although the cost of a licence will vary between local authorities, a five-year licence typically costs about £500. Landlords may also be subject to new, enhanced “fit and proper” tests before they can be granted a licence, which, if introduced, would probably require them to submit a Disclosure and Barring Service (DBS) check, at a cost of £25. Note that if your HMO should be licensed, but isn’t, you can be fined and ordered to repay up to 12 months’ rent.

The government also plans to impose a new minimum room size of 6.52 square metres for a single person, in line with the current standard for overcrowding. For couples, the minimum is likely to be 10.23 square metres. Importantly, this new minimum may affect the number of rooms in a home that can be legally let. For example, if a “box room” in a four-bedroom student house falls below the minimum room size, the property would be considered a three-bedroom house. Landlords letting a room smaller than the prescribed dimensions would be liable for an unlimited fine or a civil penalty of up to £30,000. Finally, owners of licensed HMOs will need to provide “adequate” waste-disposal facilities.

Once the rules are confirmed, landlords should be careful to budget for any added expense they bring. The changes also come at a time when many landlords are already under increasing financial pressure, with lenders now required to take a more stringent approach to buy-to-let mortgage applications from those who own four or more mortgaged properties. That’s on top of the recently introduced 3% stamp-duty surcharge on second homes, and the scaling back of mortgage interest tax relief. If you didn’t already have the message, buy-to-let looks like an increasingly risky bet as an investment.

Yours for £25m: a 30ft hole

A Grade II-listed London townhouse with a 30-foot hole in its garden has been put on the market for £25m, says Sean Morrison in the Evening Standard. The Knightsbridge house was once owned by conman Achilleas Kallakis, who ordered the excavation of the home’s “mega-basement”, which was designed to hold a swimming pool, spa and car-lift. However, workers abandoned the job in 2008 when Kallakis was convicted of 21 charges related to his property business, including conspiracy, forgery and money laundering. In December, Kensington and Chelsea council approved plans to build an “astonishing” nine floors of living space, featuring a pool, underground parking and reception areas.

Source: Money Week

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How to deal with the proposed amendments to HMO licensing in England

The Government recently published the outcome of their consultation regarding changes to HMO licencing and it is anticipated that amendments will be made in line with their findings. The big question facing landlords is what will these changes to mean for them? Many landlords that are not currently affected by licensing will suddenly require one and I doubt very much that Landlords are even aware!

The current situation

At the moment, properties classified as large HMOs already have to comply with licensing. Your property falls into this category if it is rented to five or more people who are not from one household, it is three storeys high or more and the tenants share bathroom/toilet and or kitchen facilities.

The proposed changes

The Government is proposing the following changes which will increase the number of properties that are subject to licensing:

• Removal of the three-storey rule

• Incorporate flats that are situated above or below commercial premises

• Put in place a minimum size requirement of 6.52sq.m which is in line with the current standard for overcrowding (Housing Act 1985). This size is likely to be 10 Sqm for HMO’s in which all tenants have their own bathroom but share other facilities such as a kitchen.

The driver behind this is to provide tenants with a better standard of accommodation and prevent the sort of problems that exist at the moment with sub-standard quality of accommodation and overcrowding. In order to support this further they are looking at putting in place additional proposals which include the following:

• In order for landlords to obtain a license, they will now have to undergo a Fit & Proper Person Test

• Landlords must provide sufficient storage facilities to deal with the holding and disposal of all household waste

How could it affect you?

Whilst it is worth noting that these are proposals only at this stage, they are likely to take from April 2018. At this point, it is expected that landlords will have a grace period of six months, providing them with time to make changes to their properties so that they comply with the rulings.  After this, those that do not comply will be subject to a fine of up to £30k as well as possible criminal prosecution.

Whether you already own an HMO or are thinking about purchasing one, you need to be prepared to deal with the new rulings.  Under-resourced Local Authorities are also going to find themselves struggling to manage the increased workload as it is estimated that the number of properties requiring a license will double.  It is also likely that additional licensing schemes will still go ahead capturing the multi-lets with only four occupiers, not five.  If you already hold a selective license, switching it to a mandatory one should not be a problem.

The good news

On a more positive note, if you are looking to get into the HMO rental market by purchasing a new property, the banks and mortgage companies seem to be looking upon these types of licensed properties more favourably.

By providing all landlords in the UK with plenty of advance warning, the Government are hoping that the changes will not be too difficult to comply with and will increase the quality of HMO accommodation generally.

Source: Simple Landlords