The HMO Legal Basics series is a collaboration between Tessa Shepperson and David Smith of Anthony Gold Solicitors. An HMO is a House in Multiple Occupation.
In this second part of our section on licensing we concentrate on HMO licence applications and what is required.
The criteria landlords need to satisfy to get an HMO License
In order to grant a licence for an HMO, a local housing authority has to be satisfied of the following:
- That the proposed licence holder and any manager of the property is a fit and proper person
- That the proposed licence holder is the most appropriate person to hold the licence
- That proper management standards are being applied at the property
- That the HMO is reasonably suitable, or can be made suitable, for occupation by the number of tenants allowed under the licence with at least the minimum prescribed standards of amenities and facilities. These include the number, type and quality of shared bathrooms, toilets and cooking facilities.
The licensing application form contains questions which enable the local housing authority to decide whether or not the landlord and the property meet the criteria and can be given a licence.
Normally, the owner is assumed to be the most appropriate person to hold a licence. If there are doubts about his ability to deal with the property then a different manager would usually be demanded by the Local Authority.
Inspections
The local housing authority does not have to inspect the property before granting a licence but in some cases an inspection may be necessary in order for the local housing authority to be satisfied that the property is suitable for licensing.
They do, however, have to inspect the property within 5 years of the licence being granted.
Inspections will also allow the local housing authority to prioritise properties for inspection under the Housing Health and Safety Rating System (which has replaced the former Fitness for Human Habitation test).
Fit and proper persons
The application form will ask about details of :
- Any unspent convictions for offences involving fraud or other dishonesty, or violence or drugs or any offence listed in Schedule 3 to the Sexual Offences Act 2003
- Any unlawful discrimination on grounds of sex, colour, race, ethnic or national origins or disability in, or in connection with, the carrying on of any business
- Any contravention of any provision of the law relating to housing or of landlord and tenant law; (including any civil proceedings that resulted in a judgment.)
Landlords who do not declare unspent convictions will be committing a criminal offence and will be subject to a fine of up to £5,000. There is also every likelihood that when this comes to light their licence will be denied or revoked.
Simply because someone has an unspent conviction for one of these offence does not mean that they will automatically be denied a licence. Each application will have to be considered on its own merits and the circumstances of an offence and its relevance to the licence application should be taken into account.
However, most Local Authorities consider unspent convictions to make a person unsuitable to manage a property, although they will usually still allow them to hold a licence. This is being challenged at the Tribunal at the moment.
Problems where landlords have convictions
The fit and proper person requirement is one reason why it is crucial that HMO landlords comply with all the relevant regulations, as any conviction, particularly for a property related offence, will put their HMO license at risk.
In most cases they will need to employ a property manager (who will be the person named on the license) if they are to continue to run the properties as an HMO.
A key motivator for prosecution by local authorities is that on conviction companies and individuals will no longer be considered to be “fit and proper persons” to hold licences under the Housing Act 2004.
The test of fitness is also relational. So a person or company can be ruled unfit because someone else connected with them has been found to be unsuitable.
This means that where a director of a company is found to be unfit, that company will almost always be found to be unfit to hold a licence while the person remains connected with them.
Some local authorities are taking this much further and are suggesting that if a director of a company which is unfit becomes the director of another company that company will also be unfit.
Next time we will be looking at conditions on licenses.
Further HMO resources:
Advice: If you need some legal advice, for example if you have been interviewed by your Local Authority and need advice, you can use our ‘HMO Hotline‘ telephone advice service.
Training: Easy Law Training has regular workshops on HMO Law & Practice. You can read about these >> here (you will need to scroll down to find out the dates).
