Avoid the risks of an inadvertent HMO

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    Avoid the risks of an inadvertent HMO

    I am a part time landlord and have two residential properties that I rent out to a tenant and his "family members". I have a Assured Shorthold Tenancy Agreement in the name of a sole tenancy holder and both of the properties are let out at market rate. I only communicate and collect rent from this individual. There are clauses in the tenancy agreement which explicitly prevent subletting. As I understand it, I have some legal requirements e.g. tenancy agreement, deposit protection, EICR, Gas Safe, Smoke Alarms, etc. All of these are in place.

    As far as I am aware, there is no legal requirement to check that the occupants are "related". Please let me know if I have missed something.

    I recently had Environment Health contact me as they believe that my property is a HMO. I am at a loss as to how I defend and protect myself against this situation. Yes, there are locks on the bedroom doors but I, along with my brothers had those on our doors when we were growing up!

    Is there something else I can write into the agreement which protects me of this risk and how do I steer clear of this risk please?

    Thanks in advance.

    #2
    Anything written into agreement may be ignored. What you going to do? Evict?

    You need (to avoid possible landlord fines) to ensure the property isn't b(legally) overcrowded and to avoid HMO regulations breach to check the relationship (passports, other evidence). If (ok unlikely) it turns out you are running an unlicensed HMO you would find any s21 invalid, plus possible rent repayment order where YOU have to repay ALL the rent.

    In your shoes I'd be checking.
    I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

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      #3
      You can change your tenancy agreement to list the people who are able to reside in the property and explicitly exclude anyone else from being allowed to live there without your consent, which won't be unreasonably withheld.

      That makes the agreement tighter and makes it clear to the tenant that they can't allow anyone else to live there.

      It does mean that your only option (as now) is to serve the tenant with notice for breaching their tenancy agreement if it turns out that they;ve created an HMO.

      While there's no specific requirement to check that people are related, that's implicit, because otherwise you run the risk you've no encountered.
      How do you check that people living there have the right to reside in the UK?

      I'd suggest that you tell the local authority that you don't believe it's an HMO, because you let to one person and only their "family members" are allowed to reside there as well.
      If the tenant has broken the tenancy agreement by allowing non-family members to live there, they're creating and managing the HMO, not you.
      When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
      Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

      Comment


        #4
        Do you mean you let both properties to this individual? He cant possibly have both places as his principal residence, so how did you imagine they were occupied if he wasn't subletting? I suspect that at best you've been naive and at worst complicit if these do turn out to be HMOs and I would doubt that telling the court you didn't know would cut it under the circumstances.

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          #5
          Be aware that not all councils use the same criteria to decide if a home is a HMO.

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            #6

            I have two separate tenants in the two tenancy agreements in question.

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              #7
              Whom (of this extended family group) are the two tenants?? Where did you get the AST from? What reference and previous landlord checks did you carry out, please?
              I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

              Comment


                #8
                Sorry for the confusion. I have two properties that I let out and each one of these is let out to individual (and completely unrelated) tenants.
                My issue is currently with one of my properties but I am looking for a solution which protects me with both of my properties.

                The AST came from a landlord association that I was a member of. I did a credit check on the tenant and also requested ID at the time of them moving in.

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                  #9
                  If it turns out not to be an HMO then you have no problem. However, if the local authority believe it is, they may decide to question you under caution. You should get legal advice if this happens. They will quiz you to see whether you really do have a 'reasonable excuse' for not knowing that this is an HMO, (assuming that they are correct). If for example, you have never/rarely inspected the properties, (which might have established who is living there), they may conclude that you have colluded with the tenant in operating an illegal HMO.

                  Comment


                    #10
                    This is what it says on the govs website

                    "A house in multiple occupation (HMO) is a property rented out by at least 3 people who are not from 1 ‘household’ (for example a family) but share facilities like the bathroom and kitchen. It’s sometimes called a ‘house share’."

                    So as long as the people are acting like a single household (eg cook a shared meal, mixed wash loads etc) it looks like they'll be ok.

                    Comment


                      #11
                      Originally posted by Berlingogirl View Post
                      So as long as the people are acting like a single household (eg cook a shared meal, mixed wash loads etc) it looks like they'll be ok.
                      That's not the case. S258 of the Housing Act 2004 specifies those not regarded as a single household here: https://www.legislation.gov.uk/ukpga...34/section/258

                      Comment


                        #12
                        I got my quote off a gov website. Is the gov giving out contradicting info?

                        Comment


                          #13
                          Originally posted by Berlingogirl View Post
                          I got my quote off a gov website. Is the gov giving out contradicting info?
                          No, the quote is fine, but incomplete.
                          The page specifies exactly what a 'single household' is for HMO purposes - which is not the same as your definition.

                          (It may be appropriate to work out if two people count as a couple, then it would matter if they eat meals together etc. But that doesn't apply to larger groups. ).

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