In 2018 the government introduced minimum room sizes for HMO properties to increase standards in the quickly growing private rented sector (PRS) and thereby protect the 2.8 million citizens that were living in homes unfit for the 21st century. This has had a tremendous impact on letting agents and landlords across the country who are having to keep track of yet another set of regulations in an already highly regulated sector – ultimately putting them at greater risk of fines and rent repayment orders (RRO). This is a particular challenge as room size data is not stored centrally and is changeable: landlord renovations can change the layout of a house, making floor plans out of date. So how can you manage this complex problem? Read on for more.
Whilst it seems like a simple question, it actually has no simple answer, in fact assessing the suitability of bedroom sizes can be one of the most challenging aspects of HMO licensing.
In order to obtain a licence, all rooms in an HMO must exceed a minimum size and can only have a certain number of people occupying a certain room. So, what this means in practice is that if an HMO has four rooms (excluding kitchen, bathrooms and living room) but one of the rooms is smaller than the minimum bedroom size, only three tenants are allowed to lease the property, reducing the expected yield (and likely return on investment) by 25%.
To put some numbers to it, under the Licensing of Houses in Multiple Occupation (Mandatory Conditions of Licences) (England) Regulations 2018, the minimum bedroom sizes are:
● 4.64m2 for a child under 10 years old
● 6.51m2 for one person over 10 years old
● 10.22m2 for two people over 10 years old
These minimum sizes do not apply to licences approved before 1 October 2018, or to HMOs that do not require a licence. Most discretionary licensing schemes run for five years before they end or, in most cases, are renewed. So whilst the properties that had approved licences in 2018 did not have to meet minimum room requirements, after 2023, this will no longer be the case. Agents and landlords should take room sizes into account before leasing any property, in order to avoid being impacted by changing licensing regulations.
● Consider the size of the room
● Consider how room sizes affect how many tenants can occupy the property
● Consider the age of the tenants and what specific room they’ll be occupying
● Check how many people are staying in each bedroom
● Consider how room sizes and number of tenants affects what specific licence the property needs
All landlords must notify the local authority of any room in the HMO with a floor area of less than 4.64 m². This cannot be used as sleeping accommodation, or the landlord or property manager may face prosecution or hit with a fine or rent repayment order.
For example, a landlord and letting agent in Camden was earlier this year slapped with a £40,700 RRO for leasing a HMO where two of the bedrooms were too small to meet room HMO size regulations (among other offences). This is a great example of a case where failing to protect the interest of your landlord customers can have huge financial consequences and negatively impact an agency’s customer relationships and reputation.
It is the managing agent’s, as well as the landlord’s, legal obligation to obtain the correct licence. Even if a letting agent’s terms of business state that they don’t take on responsibility for licensing, the Housing Act 2004 places responsibility for licensing a property on anyone who meets the statutory definition of person having control or person managing the property. Failing to do so could result in heavy-handed penalties and rent repayment orders (RROs).
It is therefore important for letting agents to be aware of how room sizes affect properties’ licensing requirements, as that determines how many tenants are legally able to occupy a specific property. If a mistake has been made, and it is found that a room is in fact too small to be legally considered a bedroom and a tenant has to move out as a result of the finding, it will be up to the management agent to cover the moving costs and relocation of the tenant.
This is exactly why it is vital that agents are aware of the regulations around room size and advise their landlords on what licence they need to avoid fines, tenant relocation fees and loss of expected income. Yet with many agents struggling to track this characteristic of the property amongst so many others, it’s often advisable to use a data partner for support.
Kamma has built the only technology in the UK capable of tracking every licensing requirement across every local authority in the country, including minimum room size requirements.
Get in touch with the team at email@example.com or book a demo to learn more about Kamma’s services
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