What is a HMO?

Welcome to our blog series about Houses in Multiple Occupation (HMOs) in Bristol. Over the coming blogs, we will explore everything from the basics of HMOs to the intricate details of legislation and regulations that govern them. Whether you’re a landlord, an investor, or simply curious about this type of property, our series will provide you with valuable insights and practical advice. HMO’s have boomed in popularity in recent years, giving landlords better returns than single buy to let’s. Here we breakdown the basics of HMO’s, giving you insight into if they’re right for you.

Today, we start with the fundamentals: What is a HMO?

Introduction to HMOs

A House in Multiple Occupation, commonly referred to as a HMO, is a property rented out by at least three people who are not from one household (i.e., a family) but share facilities like the bathroom and kitchen. The best example would be student housing where multiple people live together under one roof from different families. Then we also have professional lets, and even large houses converted into shared living spaces for individuals. Unlike single buy-to-let properties where one family or a single tenant occupies the entire property, HMOs accommodate multiple tenants, each typically renting a room but sharing communal areas.

Types of HMOs

Student Housing

Student HMOs are a familiar sight in university towns and cities. These properties are specifically tailored to meet the needs of students, offering them affordable and conveniently located accommodation. Typically, student HMOs feature multiple bedrooms, shared bathrooms, and communal kitchen and living areas. The layout is designed to foster a communal living environment while ensuring each tenant has their own private space. Typically found around Redland, Whiteladies road and Clifton area of the city.

Professional Lets

Professional lets cater to young professionals and individuals who seek a similar communal living experience but with a more refined and sometimes quieter environment than student housing. These properties often have similar layouts to student HMOs but might include additional facilities such as en-suite bathrooms, higher quality furnishings, and services like cleaning of communal areas. These are typically found in city centres, or around large employers – so think Horfield for Southmead Hospital.

Layouts and Setups of HMOs

The layout of a HMO can vary widely depending on the property size and the needs of the tenants. Here are some common setups:

Shared Houses

In a shared house HMO, each tenant typically has their own bedroom but shares other facilities like the kitchen, bathroom, and living room. Bedrooms can vary in size, with some offering space for additional furniture or even small workspaces. Minimum room size by law for a single occupant is 6.51 square meters. For 2 people sharing a room, it’s 10.22 square meters.

Bedsits

A bedsit is a form of HMO where tenants have their own bedroom and potentially a small cooking area, but share bathrooms with other tenants. This setup provides a bit more privacy while still being cost-effective. There

Studio Flats within HMOs

Some buildings are configured to include self-contained studio flats, each with its own kitchen and bathroom facilities, while sharing other amenities like laundry rooms and storage spaces. These are individual units within a building and best registered separately.

Key Differences Between HMOs and Single Buy-to-Let Properties

Tenant Demographics

• HMOs: Cater to multiple, unrelated tenants. They are popular among students, young professionals, and individuals seeking affordable housing options.
• Single Buy-to-Let: Typically rented to a single family unit or individual tenant, offering more privacy and space.

Rental Income

• HMOs: Generally offer higher rental yields due to multiple tenants paying rent. However, they also come with higher management and maintenance responsibilities. Each tenant that moves in/out will need a exit inventory, and then for check-ins you need new referencing, inventory, and will have void periods to deal with.
• Single Buy-to-Let: Usually provide a steady but lower rental income compared to HMOs. The management of these properties is often simpler and less time-consuming. You’ll typically have one tenancy that stays for several years.

Management and Maintenance

• HMOs: Require more intensive management due to the higher turnover of tenants, regular maintenance of communal areas, and compliance with specific safety and licensing regulations.
• Single Buy-to-Let: Easier to manage with typically lower maintenance costs, especially if let to long-term tenants.

Legal Considerations and Permissions

Managing an HMO comes with specific legal obligations that differ significantly from those of single buy-to-let properties. Some key considerations include:

Licensing

Most HMOs require a specific license from the local council. This license ensures that the property meets the required health and safety standards, including adequate fire safety measures, proper facilities for cooking and washing, and overall property condition. Licensing requirements can vary by local authority, and in Bristol, the specifics can be found on the Bristol City Council’s website. Front Door Lettings will help guide you through any legislation and requirements to bring your property up to the right level.

Planning Permission

Operating an HMO may require planning permission, especially in areas with an Article 4 Direction in place. Article 4 Directions remove certain permitted development rights, meaning that landlords must seek planning permission to convert a property into an HMO. Bristol has several areas where Article 4 Directions apply, aimed at controlling the proliferation of HMOs in certain neighbourhoods.

Safety Regulations

HMOs must comply with a range of safety regulations, including fire safety, gas safety, and electrical safety. This includes installing smoke detectors, providing fire extinguishers, and ensuring that gas and electrical appliances are regularly checked and maintained.

Living Standards

Local councils often impose minimum living standards for HMOs. This includes space standards for bedrooms, adequate cooking and bathroom facilities, and proper maintenance of the property. Ensuring that these standards are met is crucial for obtaining and retaining an HMO license. It goes without saying that the nicer and better quality the HMO, the better the rental income and standard that tenants will keep the property at.

Future Blog Posts

In the upcoming posts in this series, we will delve deeper into each of these legal and legislative aspects, providing detailed guidance on how to navigate them effectively. We’ll explore the intricacies of obtaining HMO licenses, understanding Article 4 Directions, ensuring compliance with safety regulations, and much more. Article 4 is becoming more widespread across Bristol and the city, it’s not a outright ban on HMO’s, but adds a layer of complexity as you’ll need planning permission to get your HMO approved.

In our next post we’ll take an in-depth look at Article 4 Directions in Bristol and what they mean for current and prospective HMO landlords. Understanding these regulations is crucial for making informed investment decisions and ensuring that your HMO operates smoothly and legally.

Looking for advice?

If you’re after expert advice on HMO management, improvement, licensing your HMO please reach out to us and we’ll be happy to assist you with any queries.