Resident landlord taking in a family as lodgers: does this create an HMO?

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  • Resident landlord taking in a family as lodgers: does this create an HMO?

    My first post, so please be gentle on me. Thanks for any pointers.

    I am a single individual and was planning for a while to get a house, the mortgage on which I can afford on my own without any rental income. However, I was hoping not to live alone and hence wanted to buy a rather large house and share it with a friend and his family (married couple and their four underage children), taking them as lodgers.

    However, it hit me recently that I will be possibly running afoul of the HMO regulations, since the above situation would be an not only an HMO (three people forming at least two households), but a large one at that! Thus I would need a license, so getting a mortgage would be difficult (let's not discuss the mortgage issue if HMO classification/license can be avoided).

    My situation is not really the usual case where you have multiple unrelated lodgers, since all of them really form a single household, but I wanted to ask what the law says.

    There is an exception where the landlord and his household count as one person, hence -- assuming I am reading the law correctly -- if it was my friend taking me as a lodger, the house would not be an HMO.

    I asked morgage advisers and were told that would not be an HMO, but were not given a reference to a ruling so I don't trust that.

    My question is, would this arrangement (single resident landlord plus lodgers forming a family of 6) be an HMO or not?

  • jpkeates
    replied
    Originally posted by BueJay View Post
    There is an exception where the landlord and his household count as one person, hence -- assuming I am reading the law correctly -- if it was my friend taking me as a lodger, the house would not be an HMO.

    I asked morgage advisers and were told that would not be an HMO, but were not given a reference to a ruling so I don't trust that.
    You should get a different mortgage broker.
    That many people in two households is an HMO (and will now require licensing).

    If your friend owned the property and took you in as a lodger, it wouldn't be an HMO.

    Leave a comment:


  • loanarranger
    replied
    On the basis of what DPT57 has said , that would indeed complicate your proposition as the vast majority of lenders would noT accept even aN conventional Unregulated BTL from you as you are a First Time investor with absolutely no experience of such types of property.

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  • DPT57
    replied
    If youre not related to the family then yes; it would be a licensable HMO.

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  • loanarranger
    replied
    I know you don’t want to know anything about mortgages, but as you will be resident in the property with the intention of subletting a major part of the property this would prove a problem in securing a mortgage. BtL’s are Unregulated but with you occupying the property this trips over to a Regulated Mortgage, something which falls outside the criteria of many leading lenders.
    Whilst I accept the comments of my learned friend theartfullodger regarding brokers they are in fact the best target to investigate what funding options are available; once that is established then the question of the property being an HMO can be resolved by talking with the Local Authority.

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  • theartfullodger
    replied
    Wouldn't be a HMO it's households (2) not people that matter.

    But... A) don't rent to friends or family...
    B) with 6 people & just you they'll end up running your home.

    Expecting mortgage "advisers" (salesman is more realistic) to understand housing law is likely to lead to disappointment.

    Leave a comment:

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