HMO regulations will prevent landlords helping tenants during economic downturn – claim

Landlords trying to help tenants out during the cost-of-living crisis could fall foul of licensing and planning laws, a leading landlord group has warned.

It’s been prompted by the story of Nottingham landlord Frank Knowles who thought he was doing a good deed by allowing a tenant’s partner to move into a two-bedroom flat after she struggled to find a property.

He says his letting agent suggested she was put onto the tenancy agreement and that he increase the rent. However, during a surprise inspection, Knowles discovered the property was now deemed an HMO and that he needed an additional rather than his current selective licence.

The landlord then found out that he would have to apply for planning permission to change the use into a HMO, which comes with a £452 fee, with no guarantee this would be approved. He now must decide whether to ask the tenant’s girlfriend to leave or evict them all.

Planning and licensing

EMPO’s business development director, Giles Inman (pictured), says this illustrates how landlords could face both planning and licensing barriers when they let tenants’ partners move into properties. They could also unwittingly find themselves breaching laws due to tenants’ actions.

“With the cost-of-living crisis, tenants will take in friends and lodgers to help pay the rent – in many cases, without landlords’ knowledge – inadvertently creating HMOs which produces problems around Article 4,” he tells LandlordZONE. “The fact the letting agent wasn’t aware in this case shows how confusing and clumsy the system is.”

He adds: “Councils don’t advertise Article 4 directions as widely as licensing schemes as they can’t levy a financial penalty in the same way.”

Nottingham’s current selective licensing scheme is due to be replaced in July 2023 and EMPO has tasked NRLA property lawyer David Smith to draw up a formal response to the plans for the Secretary of State on its behalf.