Letting agents are reminded that the clock is ticking towards the October 1 deadline, when the rules on mandatory HMO licensing change across England.
There has been no government campaign to raise awareness among agents and landlords, and nothing to explain what appears to be a little-known exemption. This is despite the possibility of swingeing penalties.
Currently, properties of three or more storeys, shared by five or more people in two or more households, where facilities such as kitchen or bathroom are shared, must have a mandatory HMO licence.
On October 1, the “storeys” criteria is removed and any property, of any height, that meets the other criteria must be mandatorily licensed.
What agents may not know is that there is an important exemption: purpose-built flats within a block containing three or more self-contained flats are excluded from the requirement.
Nothing from the housing ministry has explained this or other new HMO rules – and yet the penalties are potentially severe enough to close a business down.
An HMO that is not licensed when the law requires it could land the agent or landlord, or both, with a criminal prosecution and record, an unlimited fine, and an order to pay court costs and a victim surcharge.
Alternatively, the council could issue a civil penalty of up to £30,000 and a rent repayment order of up to 12 months’ rental income.
While a property is unlicensed, a Section 21 notice cannot be served.
Licensing expert Richard Tacagni said agents should be absolutely certain that HMO properties falling under the new rules are licensed promptly.
He said: “Many agents don’t yet fully appreciate the implications, and their criminal liability if an application is not submitted on time.”
An excellent guide by Tacagni for all agents in England is here
A second article is especially aimed at London agents but does explain the exemption for flats in purpose-built blocks of three or more apartments.
It also reveals that many London authorities – and this may well apply to councils outside the capital – are not making the process for HMO licence applications particularly easy.