A Briefing on House in Multiple Occupation (HMO) Property in Scotland

History

The House in Multiple Occupation (HMO) regulations were first introduced in Scotland in 2006 to address over-crowding and low standards in private rental accommodation. Initially the framework was discretionary for individual local authorities, but in 2011 it became compulsory for them to manage HMOs in their area.

What is an HMO

An HMO is a property shared by three or more people from more than two family units. A family unit includes couples as well as relatives such as parents, grandparents, children (and step-children), grand-children, brothers, sisters, uncles, aunts, nephews and nieces. The vast majority of HMO licensed properties are shared houses or flats, but larger purpose-build accommodation, such a student halls, also require a license. Houses with bedsits which have shared facilities, such as kitchens and bathrooms, are also HMOs.

Obtaining a license

An application must be made to the relevant local authority, who each set their own fees. In Glasgow, it typically takes six to twelve months to process an application and the fee is around £2000. The applicant may be required to attend a local council committee hearing.

After three years a renewal application must be made, and another fee (currently around £1000) paid. The license must be in the name of the property owner. The council will run a “fit and proper person” test on the applicant and inspect the property to make sure it meets the standards.

If ownership of an HMO property changes, the new owner can continue renting the property but must make an application within a month of the change of ownership

Standards

The Scottish Government has published statutory Guidance which has detailed information on the standards which must be met. In general, the standards are stricter than for regular rental properties. For example, smoke detectors are required in all bedrooms in addition to lounges and hallways. There is also a requirement for fire fighting equipment and for regular fire alarm checks. Fire doors must be fitted internally.

Gas safety checks are required annually, and carbon monoxide detectors must be fitted in all rooms with a combustion device, unless it is used solely for cooking. The electrical installation must be checked every five years and the appliances tested every year.

The guidance also has standards for minimum room sizes of bedrooms, living rooms and kitchens, which vary with the number of planned occupants.

Enforcement

Compliance with HMO regulation is strictly enforced with fines of up to £50,000 levied on property owners who operate unlicensed or non-compliant HMOs. Prior to granting a license, the property will be inspected. Recommendations for improvement will usually be put forward. A further inspection will be carried out at each license renewal.

Penalties will be applied for late renewal applications and for breaches of licensing conditions.

If you’d like advice about your legal obligations as a landlord in Scotland, we’d be happy to help. Contact us about our services for landlords today.