HMOs switched to family lets to avoid licensing

AFS Team·1 February 2013·3 min read

HMOs switched to family lets to avoid licensing
Around a third of landlords have changed one or more of their properties into a family home after new shared house licensing laws were introduced.

Oxford City Council questioned 30 landlords and found that nine have reduced the number of houses of multiple occupation (HMOs) that they offer.

A change of law in the city meant that all small HMOs must have a license.

A small HMO is for three to five unrelated sharers – larger HMOs for six or more sharers or houses of three storeys or more already required a mandatory licence.

Oxford is the first local authority to bring in a city-wide licensing rule for small HMOs.

The council argues the new regulations have not led to landlords leaving the rental market, while pointing out complaints about noise and rubbish have fallen nearly 50% following the change in the rules.

Under the new rules, anyone renting a property as a small has to apply for a licence, undergo inspections on a regular basis, and pay a fee of around £362 before the house is let.

Councillors are due to meet to discuss a progress report on small HMO licensing, A report says: “Of the 30 landlords surveyed, 17 owned five or less properties, six owned six to 10 properties and seven owned more than 20.”

Of the landlords questioned, 72% had felt some impact from the new rules, and half said they expect the rules to affect their future plans for how they buy or use their properties.

Furthermore, two-thirds revealed that they have put up their rents since January 2011, with nearly seven in 10 saying that the HMO licence fees were a factor in their decision.

Oxford City Council has issued more than 3,000 HMO licenses since the new rules came into effect.

Councillor Ed Turner, executive member for finance, reckons feedback from residents group is that the new law has been a success.

“Clearly some landlords will be unhappy with the scheme, but our view is we need to raise standards of properties and management and we see no evidence of a mass exodus of landlords,” he said.