What is considered illegal when owning a house in Multiple Occupation?

You could commit an offence if you:

• Own a property that is a House in Multiple Occupation (HMO) and is unlicensed. Penalty: Prosecution with unlimited fines (previously subject to a £20,000 maximum)
• Permit more than an agreed number of people or households to live in the property. Penalty: Prosecution with unlimited fines (previously subject to a maximum of £20,000)
• Breach any of the other conditions attached to the licence. Penalty: Prosecution with unlimited fines.

Other penalties

• If you collect rent for a property that does not have a licence and should have one. Penalty: A Rent Repayment Order may be issued by the First-Tier Tribunal (Property Chamber). The landlord may be required to pay back up to a year’s worth of housing benefit paid whilst the property operated without a licence. Rent repayment Orders may be applied for by the Council to recover Housing Benefit and/or by the tenants to recover any payments made.
• If you have tenants in a property that does not have a licence, but should have. Penalty: The right to evict tenants is suspended until a licence has been obtained.

Other points to note:

A licence is granted for up to 5 years but it can be granted less in certain circumstances.

The Council may revoke (cancel) a licence, or the licence holder may apply to have the licence revoked.

Reasons for revoking a licence:

• House is no longer an House in Multiple Occupation (HMO)
• Licence holder changes.
• Any other change in circumstances
• Where there has been a serious breach of a condition or repeated breaches.
• Where the licence holder is no longer suitable to hold the licence
• Where the management is no longer satisfactory.
• Where the HMO is no longer suitable to be an HMO.

The Council may vary (change) a licence or the licence holder may apply to have the licence changed for the following reasons:

• Following an inspection of the property there is a need to change the licence conditions
• There is a change to the information provided on the application form
• Where there is a change to the legislation and the standards associated with it.

Appeals 

Any decisions made by the Council will be given to you in writing. You will be given the opportunity to appeal against any decisions made. Any appeal must be made to the Residential Property Tribunal within 28 days of the decision being made.