Live-in landlords on resi-mortgages vs HMO licensing and mortgages.

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    Live-in landlords on resi-mortgages vs HMO licensing and mortgages.

    Evening all, tried searching for similar posts but no joy. So sorry if this is wordy:

    TOPIC:
    Had a chat with a live-in landlord, the property in question is a flat: one shared bathroom and kitchen, no livingroom. The live-in landlord and 2 lodgers share the property. One lodger wants to move in a friend, who will pay extra rent - apparently it's a huge room - so that will be 3 lodgers in total.

    I've understood, when it comes to HMOs: 3 unrelated TENANTS in one property qualifies for the HMO licence and mortgage. However, when it comes to LODGINGS: 2 unrelated LODGERS [excluded occupiers] and a LIVE-IN LANDLORD are exempt from HMO licensing, but add a THIRD lodger and the landlord's primary residential address seems to qualify for a HMO!

    QUESTION(s) - while stating the obvious:
    To have a HMO licence, you need a HMO mortgage yes? Yet a single- storey flat doesnt qualify as a 3-storey building. Mortgage wise it can qualify as a multi-let or BTL, maybe a mini HMO, but a landlord cannot reside in any of those right? So how can a landlord, on a resi-mortgage living in a single-storey flat suddenly become a HMO? Surely this landlord would just inform the council and the council would whack the council-tax up? Or have HMO licenses wiped that out too?

    I checked on Spareroom:
    "The Housing Act [2004] defined a House in Multiple Occupation as a house with more than 3 unrelated people sharing, forming two or more households. Of course it doesn't need to be a house, it could be a flat or a barn or a converted church; what matters is how many people live there, and what relation they are to each other." This doesnt make sense - the license means transferring to a HMO mortgage, and for that it would have to be a 3-storey flat!
    (https://www.spareroom.co.uk/content/...me-into-an-hmo)

    Any clarifications welcomed; I suggested they call the council and find out! But it left me with brain-ache...

    #2
    Don't know the answer to that specific question but just to add to it, I think there may be tax issues too. My understanding is that with that number of lodgers, Hmrc may tax it as a lodging house.

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      #3
      True, thats another point. Thank you.

      Comment


        #4
        It's not about licensing.
        The increased number of people males it an HMO and all the statutory regulations apply.
        Just like that.

        The council may require licensing, it's a local policy, not a national one.

        It may require panning consent, as planning policies can control where HMOs are allowed.

        If the property has a mortgage it will depend on the mortgage terms and conditions (which may already preclude lodgers).
        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

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