Wednesday 19 December 2018

Landlords need to know about new HMO and Section 21 rules

Author: Andrew Page

House keys

On October 1st, new regulations came into force governing how HMO properties are classified and licensed, and how easy it is for landlords to evict their tenants. If you’re a landlord, you need to make sure you understand how these new rules impact on your properties, your tenants, and your investments.

New HMO regulations

An HMO is a House in Multiple Occupation. HMOs are classed as being properties where three or more people who are not from the same household live together and share facilities like a bathroom and kitchen. Previously, HMOs that housed five or more people over three floors required a special license. Landlords had to ensure that these properties met certain criteria and that their rentals were safe for multiple people to live in.

As of this month, the classification of HMOs is becoming a lot broader. As lovemoney.com says, “Licencing is about to become far more widespread…as the minimum property size is being removed. As a result, any HMO properties with five or more occupants will require a licence.” There is no grace period for landlords who now find themselves with HMOs. This means you’ll need to apply for a license straight away if you want to avoid a fine.

Changes to Section 21

Section 21 notices can be used by landlords to evict tenants from a rental property. Landlords don’t have to provide tenants with a reason for the eviction, they just need to give them two months notice to move out of the address.

Although section 21 notices can still be used for this purpose, the rules surrounding evictions have become a little more complex. As of 1st October, landlords have to move forward with possession proceedings within six months of issuing a section 21 notice. What’s more, section 21 notices can no longer be issued within the first four months of a tenancy.

One of the biggest changes, however, relates to ‘revenge evictions’. If a tenant makes a valid complaint about the state of a property and these complaints aren’t dealt with by the landlord, the tenant can take the issue to their local authority. If the council issues an improvement or emergency work notice, the repairs have to be carried out before a section 21 notice can be issued, otherwise it won’t be valid.

Understanding exactly what these changes mean for you and your investment properties is crucial if you’re going to stay on the right side of the law and keep your tenants happy. Find out more about becoming a landlord, and applying for buy to let mortgages, by taking a look around our site today.

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Written by: Andrew Page