Housing in multiple occupations, commonly called housing of multiple occupancies, is a term that refers to a situation where a house has been let out to a minimum of three persons who form 2 or 3 households.
The occupants of this house share the same kitchen, bathroom and toilet. For a house to be classified as an HMO (Housing Multiple occupancies), it must be occupied and used by the occupants or tenants as their primary or only residence. In this post, I will explore and explain what HMO is.
What is the Design of an HMO?
If you plan on building a house of multiple occupancies, employing a professional architect service is compulsory. As an HMO owner in the making, knowing the layouts and design patterns of various HMO\’s is not a bad idea.
There are basic things an HMO should have. How you converted your existing house into an HMO to maximize your cash flow would be discussed later on in this article. Typically, bathrooms and kitchen are areas commonly shared by all occupants. Other common areas that the tenants share are gardens, staircase, etc. HMO\’s are commonly split into self-contained flats, bed-sitting rooms and simple lodgings.
How to Obtain an HMO Licence
Obtaining an HMO licence is not as easy as people may think it is. HMOs are popular among buy-to-let investors because of their ability to generate a high income within a short period.
The high-income potential of HMOs gives it an edge in investors\’ eyes when it comes to buy-to-let properties. Separating a single property into smaller multiple properties, let out on different tenancy agreement, helps house owners reduce their earnings loss through payment in arrears. Licensing is generally classified into three:
1. Mandatory Licensing for Large HMOs
This type of license can only be granted to large HMOs where tenants are a minimum of five and comprises a minimum of two households. The license also has its validity in all areas of the country. This applies nationwide for HMOs where there are five or more occupants in a property, and the tenants comprise two or more households. This license holds exception to flats situated in a house containing four or more self-contained flats.
2. Additional Licensing
Additional licensing can occur when a council imposes a policy requiring other HMOs\’ sizes to be licensed.
3. Selective Licensing
From its name, selective licensing implies that the licensing decisions are solely at the borough\’s discretion. This licensing can affect all properties used for renting irrespective of their size, the number of storeys, and tenants. Before giving a licence, the local authority must be sure that the landlord and any managing agent of the property to be licensed is fit to hold a licence and that the property meets required physical standards.
Licenses are granted when:
- Necessary fire safety measures are such as smoke detectors, extinguishers etc., are in place.
- Annual gas safety checks are up-to-date
- The electrical wiring and appliances have been certified by an expert as safe for the next three years.
- The properties occupying the house is not overcrowded
- Communal and publicly used areas are kept clean and in good repair
- There are appropriate refuse storage and disposal facilities
Once granted, the licence must be displayed within the communal areas along. The procedure to be followed in obtaining an HMO licence in several countries varies. Embedded in the constitution of countries like Ireland, the United States of America, the U.S.A, Britain, etc, are strict laws that reveal the process of getting an HMO license. We, therefore, advise that you do deep research and visit necessary agencies for information on how to go about obtaining an HMO license.
Conclusion
As the case may be, having an HMO or several HMOs is a great asset to an HMOs in one that generates consistent income for you. Always make sure you have the right license from the right body to own an HMO (Housing Multiple occupancies). If you need architectural services to help you achieve your goals, please get in touch, and we would be delighted to help.
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