I'm often asked what the difference is between getting an HMO licence and having permission to rent out a property as an HMO in an Article 4 area.
Having an HMO licence doesn't mean you have permission to rent your property as an HMO. Similarly, having planning permission to rent your property as an HMO in an Article 4 area doesn't mean you won't require an HMO licence.
The main purpose of HMO licensing to ensure a property meets certain requirements for the health and safety of its occupants.
The purpose of Article 4 directive is to control works that could threaten the character of an area i.e. restricting the number of houses that can be turned into HMOs.
HMO licensing is carried out by a local authority's HMO Team, whereas obtaining C4 HMO status is overseen by the local authority's Planning Department.
The two things are independent from one another.
When do you require an HMO licence?
Mandatory HMO licensing is applicable when the property is rented to 5 or more tenants from 2 or more households on a shared tenancy (such as a student let) or rented as individual room shares/bedsits who share an amenity such as a kitchen, toilet, bathroom, or lounge.
So, when can you rent a property as an HMO in an Article 4 area?
Article 4 restricts a property owner's permitted development rights to switch between planning use classes without first getting planning permission from the local authority.
This means if you want to rent a property as an HMO in an Article 4 area you need to prove you have the right to do so by presenting unbroken tenancy history showing HMO use since the date Article 4 was introduced. In Leeds this was February 2012.
The tenant base of HMO's are usually students or young working professionals. These types of tenants are attractive to landlords and investors because rent can be charged by the room, as opposed to per property, meaning the revenue generated from an HMO would be far higher than if the same property were rented to a family. This can lead to a dwindling supply of housing to rent for families because investors buy up properties to convert them into HMOs.
Therefore, the local authorities want to control the number of houses that can be turned into HMOs.
This has absolutely nothing to do with HMO licensing & can be regularized by obtaining a Lawful Development Certificate.
To keep things straightforward:
1. You will require an HMO licence if renting a property to at least 5 people from two or more households, whether the property is situated in an Article 4 area.
2. You will need to be able to prove you have permission to rent property as HMO in A4 area by evidencing continuous C4 HMO use backdated to when Article 4 was introduced.
Should you have any further questions about HMO licensing or HMO planning issues please do not hesitate to contact us on 0113 2781188 where one of our team will be happy to help.
