This case illustrates the importance of taking expert advice before renting out spare rooms. When the owner occupier of this property decided to share their home, they unwittingly turned it into an HMO.
With lots of room to spare in the London home shared with a family member, the owner decided to open it up to three trusted housemates. But the relationship turned sour when a no-win, no-fee company that specialises in seeking out breaches of licensing requirements contacted the occupants and told them they could have thousands of pounds of free money.
By renting out more than two spare rooms to people who weren’t part of their family, the owner had unwittingly created an unlicensed HMO. With the number of people in the family plus three lodgers, the house immediately became subject to Mandatory Licensing.
As someone who simply wanted to offer up some space in a crowded rental market and earn a little extra income on the side, this owner was unaware of the many regulations governing private rentals. But ignorance is not a defence, as they soon found out to their cost.
When the no win, no fee claims company contacted the occupants, they decided to take advantage of the situation to claim back the £7,800 they’d paid in rent.
The owner immediately secured the required licences, but it didn’t deter the formerly friendly housemates from pursuing their claim. When Landlord Licensing & Defence intervened, they received less than half the amount they’d demanded – saving the owner £4,450.
Although Rent Repayment Orders are often touted as payback for rogue landlords who exploit vulnerable tenants, the reality is usually very different. In this case, the owner was not a career landlord, or even a second property owner – simply a well-meaning person who opened up the family home.
But without the help of Landlord Licensing & Defence, they could have found themselves on the council’s register of rogue landlords and the subject of negative local press.
CS1595
