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Hi, I'm looking to buy a HMO in Doncaster (DN1) where HMO license is not required at the moment. Obviously it can change in the future, so I want to make sure the property ticks all boxes in case licensing becomes mandatory. Can anyone help me understand the criteria of a HMO to pass this process? Many thanks
I would hold off buying any type of HMO
Wait until all the new HMO legislation has been introduced.
There are too many unknowns at the moment
It could be for example that a property which is a purpose built 3 bed flat with 3 unrelated sharers could be required to meet the same regulations as a mandatory licensed HMO
There are just too many unknowns to risk investing into HMO types properties or where you are intending to let to more than single let tenants.
Property prices aren't going anywhere so waiting for the new regs to come into force would seem to make sense cos then you'll know what the new HMO game is
Thanks for the swift comment, Paul_Barrett,much appreciated. Do you know a good source of current requirements for amandatory licensed HMO? I read so many contradicting articles on the subject...
Your comment neatly encapsulates the problems.
There is no real definition of what will result.
Which is why I suggest holding off of any new investment into HMO lets.
You could find that the new regs reduce property values etc
Play safe and invest in single let properties or ones that will only take 4 unrelated sharers so as to avoid mandatory licensing.
If additional licensing was introduced or is currently in force you need to ensure that the property price is viable as a single let as additional licensing requirements could make the property unviable when let to 3 unrelated sharers.
All is uncertain in the HMO world currently and is not one I would invest in at the moment.
Thanks Paul, I agree its better wait for now!
Yep I don't think there is any rush now.
If you wanted to tip your toe into HMO style property without being subject to MANDANTORY HMO licensing then invest in a 4 bed property which could be equally let as a single let as well as to 4 unrelated sharers.
That will give you an idea of HMO style issues.
Of course there is the risk of additional licensing
As far as I am aware there are no existing circumstances which require properties that are subject to additional licensing will be required to meet the same improvements as a Mandatory HMO.
Personally I think all bets are off as I believe there will be a major review of what is a HMO and what licensing requirements if any will occur.
Go to your local authority website. The environmental health department will deal with HMO's.
Most important are, room sizes, fire doors, mains interlinked smoke alarms and general fire hazards.
You will also need to pass a personal assessment and if applicable, your mortgage lender will be contacted.
We did ours last year and didn't need licence. However we decided to future proof ourselves and did everything that a licenced HMO would require and more. So I don't see why you don't go ahead on that premise. There's plenty of info on the net to tell you what is needed.
The other reason to go ahead now is once you are up and running it's unlikely they will stop you in the future. You are 1st in line as you are up and running as opposed to waiting and then joining the rush. Some councils have a section 4 imposed where they can stipulate where and how HMO's are set up. One council I know states no 2 houses next to each other can be an HMO and no more than 10% in the street. If you are already up and running then it' everyone else that's got the problem not you.
Good luck Derek
Hi - thanks for the valuable reply. My initial strategy would have been to buy a built proof property, which will comply with all criteria I might need in the future. Best to reach out to the council to confirm their requirements and then hope future doesn't bring surprises ?
I disagree about staments with regards to risk.
You just have to do your due diligence:
HMOs are not rocket science but you do need former landlord experience and patience to work things out.
After all running costs and voids are deducted, if I were to run four bedroom HMOs, the net return would be no different to a standard buy to let. Make sure you look at finances carefully. In your area it may be different.
Rural Practice Chartered Surveyor. Experienced in estate management, residential investments, planning and development and rights for utility apparatus. All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
An interesting perspective and probably one that the Govt has considered which is why it proposes mandatory HMO licensing for more than 4 occupiers.
It seems that you need a fifth occupier to earn more than a single let.
Will a purpose built 5 bed house be required to carry out HMO measures
To me it just seems sensible to wait and see the outcome of these new HMO regs.it is only a few months and then everything should be clear.