At Planning House, we specialise in providing expert town planning consultancy services for a diverse range of clients, including homeowners, property owners, and developers. Whether you’re considering a new property development or looking to make changes to your existing home, our tailored services are designed to meet your unique needs. In this article, we focus on the intricacies of Houses in Multiple Occupation (HMOs), offering a comprehensive guide for property owners and developers looking to explore this increasingly popular investment strategy.
What is an HMO?
A House in Multiple Occupation (HMO) is defined as a property rented out by at least three people who are not from the same household but share facilities such as the bathroom and kitchen. HMOs can range from small shared houses to large buildings converted into multiple flats. This classification covers a broad spectrum of shared housing arrangements, each subject to specific regulations and requirements.
Discover more in our Practical Guide to Houses in Multiple Occupation (HMOs).
Benefits of Investing in HMOs
Investing in HMOs offers several compelling advantages. Firstly, HMOs typically provide higher rental yields compared to single-let properties. This is because the property is let on a per-room basis, maximising rental income. Secondly, there is a growing demand for affordable, shared housing solutions, particularly in urban areas where housing costs are high. Lastly, HMOs diversify rental income, reducing the financial risk associated with tenant vacancies. In an HMO, even if one room is vacant, the property still generates income from the remaining tenants.
Navigating HMO Planning and Regulations
Converting a property into an HMO often requires planning permission. This is particularly true if the conversion involves significant structural changes, involves a Sui Generis HMO (for more than 6 occupants) or if the property is located in an Article 4 area. Article 4 Directions remove certain permitted development rights, meaning you will need to apply for planning permission even for changes that would normally be permitted. Understanding the local planning framework is crucial to ensure compliance and avoid potential legal issues.
Most HMOs require a specific licence from the local council. The licensing process ensures that the property meets certain standards, including health and safety regulations, fire safety measures, and minimum room sizes. The exact requirements can vary between councils, so it is essential to check with your local authority. There are three main types of HMO licences: mandatory licences for large HMOs, additional licences for smaller properties, and selective licences for all rental properties in specific areas.
Ensuring compliance with all relevant regulations is an important aspect of managing an HMO. Fire safety is particularly important, and properties must have adequate fire alarms, extinguishers, and escape routes. Additionally, the property must meet certain standards for amenities and living conditions, including minimum room sizes and sufficient bathroom and kitchen facilities. Non-compliance can result in significant fines and legal penalties, so it is crucial to adhere to all regulations diligently.
How Planning House Can Help
Our team at Planning House has extensive experience in town planning and HMO regulations. We can provide detailed advice on the best strategies for developing and managing HMOs, helping you make informed decisions that align with your investment goals. Whether you are a seasoned property developer or new to the world of HMOs, we can offer the insights and support you need to succeed. Get in touch for more information.
Related Content
More information for you is available in our series of eBooks and Practical Guides which cover everything from the very basics of town planning to application processes and what developers need to consider.
You might also find the following articles helpful:
- Certificate of Lawful Proposed Use or Development (CLPUD)
- Certificate of Lawful Existing Use or Development (CLEUD)
- HMO’s & Certificates of Lawful Development
If you’re not sure if you need help from a Town Planner take a look at blog on When to Hire a Town Planner our download a Guide on How to Choose a Town Planner.
