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Small shared dwelling houses occupied by between three and six unrelated individuals, as their only or main residence, who share basic amenities such as a kitchen or bathroom.
Houses In Multiple Occupation
Recent changes in planning have made it easier for landlords to let properties as houses in multiple occupation (HMO) or change a HMO to a single dwelling. A HMO is a house that is let as a main or only home to at least three tenants who do not form one household. Therefore, a house occupied by a landlord and one lodger or shared by two people, whether or not they form one household, would be considered to be a house in multiple occupation.
A note of caution to landlords, the recent changes only apply to houses that are shared by three to six occupants. While there is a limitation on the number of occupants, a slight increase in that number should not necessarily amount to a material change of use.
Planning legislation requires one to obtain planning permission not only for new building work but also for changes in the use of buildings or land. There are instances where changes of use in specific cases are permitted under the General Permitted Development Order.
The Use Classes Order places users of land and buildings into various classes. In April 2010, a new class was introduced, Class C4, which covers small shared houses or flats occupied by three to six unrelated individuals who share basic amenities.
Large houses in multiple occupation which comprise more than six unrelated individuals are unclassified by the Use Classes Order and come within a category known as sui generis. A planning application will be required for a change of use from a dwellinghouse to a large HMO or from a Class C4 (small HMO) to a large HMO where a material change of use is considered to have taken place. The legislative changes introduced in October 2010 permitted change of use from a single dwelling to a small HMO (3-6 persons) without the need for planning permission. Neither is planning permission required for a change from a small house in multiple occupation (C4) to a single dwelling.
Not all local planning authorities have welcomed these changes. In certain areas, there is a proliferation of houses in multiple occupation and local planning authorities have started to use existing powers in the form of Article 4 Directions to remove these permitted rights. Therefore, landlords are warned to check whether such a Direction has been made in respect of the area in which the property is located to avoid being in breach of planning control. In such a situation the local planning authority could serve an enforcement notice requiring the landlord to carry out such structural works as are necessary to convert the house back to its previous use.
Landlords are advised to seek legal advice or check with their local planning authority before they propose any changes in the use of buildings or land.
Landlords should also be aware that they may require a licence and liability for Council Tax will lie with the landlord. There may be instances where the Valuation Office takes the view that the individual units are self-contained units and, therefore, Council Tax should be charged on each separate unit as opposed to one unit should the property be an HMO. Currently, there appears to be a conflict in some areas of the country between planning and taxation as a property which for planning purposes would be considered to be a HMO is being considered by the Valuation Office in some instances as separate units. This appears to be due to the lack of clarity in the legislation and we hope this will be resolved in the near future.