The Welsh Government has set out plans to change how Houses in Multiple Occupation (HMOs) are treated for council tax.

If the proposals go ahead property owners, not tenants, will remain liable and HMOs will be valued as a single dwelling. 

This addresses long-standing inconsistencies where some HMOs were treated as several separate dwellings, depending on their layout and facilities. 

That variation has created uncertainty for agents, landlords and tenants, particularly when determining liability and council tax bands.

Members of Propertymark – the letting agents’ trade body – operating in Wales under the current system have reported that, because Local Authorities have the discretion to define what an HMO is for the purposes of Council Tax, there is variation between different areas.

If the proposals go ahead, they will affect licensed and unlicensed HMOs.

Propertymark says agents will play an important role in ensuring landlords and tenants understand the new regime.

Importantly, if a property was assessed and disaggregated by the Valuation Office Agency (VOA) before the proposed changes come into force, they will need to apply to the VOA to alter the valuation list.

Overall the trade body welcomes the move, saying it brings greater consistency to the system and aligns Wales more closely with the approach already taken in England.