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Cheshire East revises HMO licensing fees

Buy-to-let landlords who operate houses in multiple occupation (HMOs) in Cheshire East will face new licensing fees after the local council decided to replace the previous £575 fixed fee with a new structure.

The fixed fee of £575, which was set for a period of up to five years regardless of the size of the HMO, has now been replaced with a scale of fees and charges, ranging from £430 for an initial licence for smaller HMOs, up to £760 for a renewal licence for up to five years for the largest.

The revised fees come ahead of changes in government legislation, which will be introduced in 2018, permitting local councils to bring HMOs under closer scrutiny.

The government is expanding the mandatory licencing of HMOs, bringing more properties into the licensing regime from 1 October 2018 with a view to ensuring more homes meet acceptable standards.

The existing law says that where the HMO is three or more storeys and is occupied by five or more people who are from two or more households, there should be a HMO licence in place.

From 1 October 2018, any HMO occupied by five or more people will need a licence regardless of how many storeys the property has.  

This includes any HMO which is a building or converted flat. It also applies to purpose built flats where there are up to two flats in the block and one or both are occupied as a HMO.

Some 60,000 HMOs currently require a licence and it is estimated that a further 177,000 properties could need one under the new rules.

Landlords who fail to comply with licensing reforms by 1 October 2018 will be committing a criminal offence from that date

Cllr Ainsley Arnold, member for housing, planning and regeneration at Cheshire East Council, commented: “Poor housing can impact on a person’s mental and physical health and mandatory licensing will be key in ensuring that landlords provide good quality, safe accommodation that is well managed.

“In Cheshire East, there are an estimated 600-650 HMOs and 51 meet the current definition for a mandatory licence. However, from October, it’s estimated that around 500 will require one.

“To make sure we can respond to the significant increase in HMOs needing a licence and safeguard those living in them, we have strengthened our resources and created additional posts.

“The licence fees and charges have also been reviewed to ensure that the full cost of processing an application, which varies according to the size of the HMO, is passed to the landlord as a valid cost of operating their business.”

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    “The licence fees and charges have also been reviewed to ensure that the full cost of processing an application, which varies according to the size of the HMO, is passed to the landlord as a valid cost of operating their business.”
    These fees will in turn be passed to the tenants as increased rent. The end user always pays.

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