Buy-to-let investors have traditionally had two choices when it comes to finding tenants and managing properties – pay a letting agent a sizeable fee or do it themselves.
Lettings agents will typically offer a “let-only” service, where they will find, interview and vet tenants, do the paperwork and take the deposit and first month’s rent for a fee of around £600 plus VAT. Then there is a “full management”service, which can cost 10 per cent of the rent or more. Here, the agent will continue to collect rent and deal with the day-to-day running of the property.
An agent’s services can be essential for landlords who have properties far away or a large portfolio to manage. But for those seeking a more hands on approach, Railton-Meeks can offer a more bespoke option to the landlord, see our list of services in our management section.
Happy to discuss your personal requirements.
HMO Licence and Licensing
An HMO licence is granted to a landlord if an HMO property meets certain standards that ensure it is safe and suitable for the tenants. In addition most HMO landlords only need to obtain a licence if the property falls into the following criteria:
- it is a three-storey house (including cellars, attics, basements, mezzanine floors and loft conversions). The definition of storeys includes habitable basements and loft conversions.
- it is occupied by five (5) or more people from two different households or more
- tenants share the kitchen, bathroom or laundry area
- in some cases, a maisonette in a house or above commercial premises may need a licence if similarly, occupied
If your property is smaller and rented to fewer people, you may still need a licence for your HMO. This will depend on the area your property is located so is it always best to check with your local council for more information.
Your HMO licence is valid for 5 years and therefore must be renewed before it comes to an end.
How to apply for an HMO License
The landlord must submit one (1) licence application for every property that will be rented out. A fee will be charged by the council for the processing of licence applications. Processing time can take anywhere between 6-8 weeks. The council will consult with individuals who may be interested in the property and deliberate whether licence conditions should be imposed for the HMO in question.
All licensed HMOs will be inspected to identify any need for repairs, or to assess fire safety, amenity or other safety concerns. Landlords must comply and bring their property up to standard within timeframe that is determined by the council.
The gov.uk website has an HMO guide that covers everything you need to know as property manager or HMO landlord.
New to HMO’s? Looking for a reputable property management agent to manage and maintain your HMO properties? Call HMO specialists Railton-Meeks today to discuss our specialist HMO management services.
Are you considering an HMO property as your next investment purchase?
The Housing Act 2004 introduced a new definition of a House in Multiple Occupation (HMO) from 6th April 2006 in England and 30th June 2006 in Wales.
When you let a property which falls into one of the following types, it is an HMO:
- An entire house or flat which is let to 3 or more tenants who form 2 or more households and who share a kitchen, bathroom or toilet.
- A house which has been converted entirely into bedsits or other non-self-contained accommodation and which is let to 3 or more tenants who form two or more households and who share kitchen, bathroom or toilet facilities.
- A converted house which contains one or more flats which are not wholly self-contained (i.e. the flat does not contain within it a kitchen, bathroom and toilet) and which is occupied by 3 or more tenants who form two or more households.
- A building which is converted entirely into self-contained flats if the conversion did not meet the standards of the 1991 Building Regulations and more than one-third of the flats are let on short-term tenancies.
- In order to be an HMO the property must be used as the tenants’ only or main residence and it should be used solely or mainly to house tenants. Properties let to students and migrant workers will be treated as their only or main residence and the same will apply to properties which are used as domestic refuges.
Whilst there has previously been no specific definition of an HMO in Planning legislation, changes introduced by Government to the Use Classes Order in England only mean that there is now a legal definition for planning terms which means that an HMO has the same meaning as in Section 254 of the Housing Act 2004.
Two specific sets of Regulations have been introduced in England taking effect from 6th April 2010. They are The Town and Country Planning (Use Classes) (Amendment) (England) Order 2010 and The Town and Country Planning (General Permitted Development) (Amendment) (England) Order 2010
Any new property to be occupied as an HMO in England will need planning consent under class C4 (HMOs), but planning consent will not be needed for any HMO reverting back to class C3 (dwelling houses). The Regulations do not apply retrospectively to any existing HMOs.
Tired of the maintenance headaches and regulations that come with managing HMO’s? Let HMO specialists Railton-Meeks manage and maintain your HMO for you, call Sylwia our Property Manager to discuss your requirements.
Stamp Duty Threshold
Stamp duty land tax on property purchases was reformed in December 2014 and is now calculated more like income tax. The rates payable increase marginally, as shown below.
Continue reading “The New Stamp Duty Thresholds”