Brokers can help landlords deal with HMO changes
New rules for houses of multiple occupancy (HMO) come into effect in October 2018. Currently, houses of three or more stories high and occupied by five or more people from more than one household are covered by HMO regulations. The new rules will cover houses of any height that are occupied by five or more people, not from a single household. This will mean that many more houses will be classified as HMOs.
Most HMO property will need to be licensed by the local authority, which will insist on safety measures such as
clearly marked fire exits and regular appliance testing. Like all buy to let properties, HMOs need to have an energy efficiency rating of at least E. Property with ratings of F or G will need to be upgraded. Every HMO house owned by a landlord needs to be licensed and licenses must be renewed every five years.
The other major change is that bedroom floor space must be at least 6.51 sq. m for a single person and 10.22 sq. m for a couple sharing a bedroom.
Brokers are aware of the changes and can advise their landlord clients if they will need to undertake work to conform to the regulations. If the work required is expensive a broker will advise on funding options including remortgaging and bridging loans. A broker can find the best loan deals and also source funds to convert property from single tenant use to an HMO.