HMO review: Changes to 2016 legislation recommended

While changes made to regulations around houses in multiple occupation (HMO) have been met with broad satisfaction from houseowners and tenants alike, a Department for Communities review on HMO legislation outlines seven proposed changes which also have a considerable level of support.

The Houses in Multiple Occupation Act (Northern Ireland) 2016, which came into effect in April 2019, transferred the responsibility for the regulation of HMOs from the Housing Executive to local councils, while also changing the scheme from a registration scheme to a licensing scheme.

A challenge raised by the Department is that many HMO occupiers are “unaware of their rights, or have few housing choices, and are therefore vulnerable to exploitation”.

The main objective of the review, entitled Review of Houses in Multiple Occupation Scheme and published by the Department for Communities in July 2023, was to examine how the scheme is working on delivering the original policy intent to “improve the conditions for tenants in this type of accommodation”.

Proposed legislative changes

Although the report states that there is broad satisfaction for the 2016 legislation from tenants and houseowners alike, the review raises seven prospective legislative changes to the Houses in Multiple Occupation Act (Northern Ireland) 2016 raised:

1. The first of these was amending section six of the Multiple Occupation Act (Northern Ireland) 2016, which pertains to notice regarding continuation of occupation. Belfast City Council’s NI Houses in Multiple Occupation (NIHMO) unit has requested that the time limit of four months in section 6 is extended to six months as with some properties which are let to students, the property may be empty from May to October. The Department states it will “consider a change to this section”.

2. The second proposed change is to section 12 of the Act, which pertains to overprovision. Currently, section 12 states that in considering whether granting a licence would result in overprovision of HMOs in an area, the Council must have regard to: (a) the number and capacity of licensed HMOs in the locality, and (b) the need for housing accommodation in the locality and the extent to which HMO accommodation is required to meet that need. The Department, however, states that “historical overprovision is outside of the scope of the Act and therefore of the review”.

3. The third proposed change is to sections 15 and 16, which are on temporary exemption notice and extension of temporary exemption notice, respectively. Currently, section 15 of the 2016 Act applies where the owner of an unlicensed HMO makes an application to the Council which specifies steps which may be taken with a view to securing that the HMO ceases to become a HMO and includes a declaration that the owner intends to take those steps. This provision allows landlords to give tenants notice to leave the property. A temporary exemption notice has an effect for three months.

Additionally, section 16 allows the exemption notice to be extended for a further three months. Belfast City Council has requested the ability to charge a fee for such notices, which is currently a free service, and that charging be allowed under this provision to bring it into line with the other notices under the scheme for which there is a charge to cover the administrative costs associated with issuing such notices. The Department for Communities has agreed to “work with councils to determine the appropriate fee” and to propose changes to the legislation “to allow such a fee to be charged”.

4. The fourth change proposed in the review is to section 29, which is on the death of a sole licence holder. Section 29 states that when a sole licensee dies, an existing HMO licence is to be treated as being held from the date of death by the licensee’s personal representatives. Section 29 transfers the licence of a deceased sole licence-holder to that person’s executor. The licence expires three months after the date of death, unless the council is satisfied that it is reasonable to extend it in order to wind up the holder’s estate. The Department proposes that this time limit is extended to 12 months.

5. The fifth change proposed is to schedule two, paragraph three, which currently states that a council “must send a copy of any application for an HMO licence to the statutory authorities”. The Department recommends the removal of the requirement for statutory agencies to be notified of all HMO applications. However, the Department states that under current legislation, the police, fire service, NIHE and the Department all get notified of applications and it is not required.

6. The sixth proposed in the review is to schedule two, paragraph 12, which sets out a time limit of three months for a council to process a HMO licence application. The NIHMO unit has reported difficulties with the current three-month limit which it states has been “exacerbated by the Covid-19 pandemic and the changes to ways of working this has entailed”. The NIHMO unit also claims that the requirement for an extension to the time limit to be made through a court is incurring significant expenditure, with the court service also querying the number of applications received in this regard. The Department proposes extending this time limit.

7. The seventh and final proposed change is to the Houses in Multiple Occupation Regulation (Fees), which currently stipulates that the maximum fee that can be charged to process a licence application is £45. The Department acknowledges that this upper limit “will have to be reviewed” to ensure that the income generated by the licensing scheme “continues to meet the costs of the scheme”.

The Department for Communities states that these proposed changes mainly involve amending the primary legislation, and therefore will “take some time to complete”.

As a new minister takes the reigns at the Department for Communities, however, work will now be beginning to review the proposals and propose legislation.