A Landlord had purchased a property and wanted to know how to turn it into a HMO and operate it legally as serviced accommodation. It was an ex-council terraced property.  

Turning it into a HMO had not been an issue, however the quality of works which had been undertaken to do so was incredibly bad and would not pass regulations under any circumstances.

This owner had not been paying proper attention and whilst his business economics required it to have five occupants to nee profitable, the distraction of a divorce meant it was operating with only two for a very long period.  It was making a significant loss and the savings he had been using to keep it afloat were coming to an end.

He just didn’t know what to do next and had heard that “there’s plenty of money in Serviced Accommodation” and thought “I’ll do that instead!”.

That’s when he called us to find out what was needed to do Serviced Accommodation legally.

The first thing we advised was that being ex-council, it is a leasehold property and this particular Council does NOT allow Serviced Accommodation in its leasehold properties!  The lease prohibits paying guests or subtenants.

Secondly this property wasn’t fit for purpose as an HMO let alone for Serviced Accommodation and would require a lot of expensive work to be done to be so.

His dereliction of duty as an HMO had come about as he was going through a divorce.  He was running the risk of significant Civil Penalty fines for all the HMO non-compliances.

The holistic advice he was given by us was not at all what he’d expected or even considered.

Our advice was to put the property on the market and sell as fast as possible.  This exit being the simplest, quickest and lowest risk to avoid spending £10,000s in Civil Penalties, fines and building works. 

He agreed and immediately put the property on the market and it has been bought by a property conglomerate buying up ex-local authority properties.

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