In our previous article (Property Inspections safeguard landlords and mortgage lenders against financial risk) we explained why property inspections are a landlord’s foremost means of maintaining the value of the property and ensuring compliance and peace of mind. Diving deeper we look at the added duties set to protect tenants of HMOs (House in Multiple Occupations) as well as tenants’ responsibilities to the landlord.
A property is considered an HMO if it is rented by three or more people who are from different households and who share facilities such as the kitchen and bathroom.
HMOs or ‘house shares’ are common in the UK, especially in cities with higher concentrations of students or young professionals who are looking for more affordable rental options. On the flipside, HMOs are attractive to landlords due to their higher income potential, but landlords of HMOs have a unique and legally binding set responsibilities and rights that come with managing multiple tenants.
HMO Landlord Responsibilities
- Display a clearly visible notice detailing the name, address and contact number of the landlord or property manager.
- Keep comprehensive records of all inspections and work done to the property.
- Acquire the right HMO specific landlord insurance policy. Remember that most insurers don’t cover subletting by tenants – check with your insurer and keep an eye on your tenants.
- Keep the property well maintained and perform professional health and safety inspections in line with safety rating systems.
- Do not allow overcrowding.
- Provide smoke alarms and heat detectors in kitchens and keep fire escapes clear of obstacles. Perform fire risk assessments in accordance with The Regulatory Reform (Fire Safety) Order 2005 to avoid criminal charges in the event of injury or death of tenants from fire.
- Have regular legionella risk assessments done by professionals.
- Have electrical equipment inspected at least once every five years.
- If the council requests and gas or electrical safety record, the landlord must provide it within a week.
- Provide and maintain a clean water supply and proper drainage system that also protects pipes from frost.
- If bedsits (a single room per occupant where for instance the bathroom is shared) are rented, the landlord must comply with the Heat Network Regulations.
- Provide at least the minimum number of bathrooms and kitchens according to local requirements (available at the local council’s Environment and Health Department).
- Make sure bedroom sizes meet minimum requirements as specified by the council in your area, for example 6.51 square metres for a single person aged 10 years or older; 10.22 square metres for two persons aged 10 years or older; 4.64 square metres for a 10-year-old child.
- Maintain safety and cleanliness of all common areas.
- Keep the interior and exterior of the property in good order.
- Provide enough rubbish bins and regular refuse disposal.
- Provide furnishings, fixtures and fittings.
Tenant Responsibilities to the Landlord
Smooth operation of and HMO is a two-way street and while the landlord has a legal responsibility to tenants to perform certain duties, tenants also must do their part. The tenant must allow the landlord reasonable information and access to perform his duties such as maintenance and safety inspections. Tenants must also take care to look after and not damage items that are the landlord’s duty to provide. It is also the tenant’s responsibility to abide by refuse and fire-safety guidelines implemented by the landlord.
Challenges to Consider when deciding to establish an HMO
Although potentially more profitable, an HMO is more difficult to finance through a lender. Then there is the challenge of finding the right property to convert to into an HMO and the higher set-up and maintenance costs. Managing and collecting rent from multiple tenants can also be more challenging and there is always the potential of higher tenant turnover.
As the UK’s leading property services company and with a stellar track record in every aspect of the property services market, Vibrant is perfectly positioned to be your guide every step of the way on your journey to establishing and running a successful HMO.
Operating in every post code in the UK, we can carry out instructions nationwide, giving you one point of service for all your inspection needs. Contact us via email for more information.