Unlicensed Houses in Multiple Occupation – Landlords Take Note!

House in SheffieldFailing to licence houses in multiple occupation (HMOs) when required to do so is a criminal offence and ignorance of the law is no defence. The First-tier Tribunal (FTT) resoundingly made that point in ordering residential landlords to repay half the rent they received from student tenants of an unlicensed property.

The case concerned a two-storey house which was rented to five students under year-long assured shorthold tenancies. The private landlords were three elderly members of the same family. During the course of the tenancies, the house became subject to a local authority requirement that it be licensed as an HMO. However, it remained unlicensed for a nine-month period.

After four of the students applied for a rent repayment order under Section 41 of the Housing and Planning Act 2016, the FTT found that the landlords had committed an offence under Section 72(1) of the Housing Act 2004 by renting out an unlicensed HMO. In those circumstances, the FTT was empowered to order reimbursement of all the rent paid by the students throughout the relevant period, a total of over £14,000.

The FTT noted, however, that the house was reasonably suitable for occupation by five students. The landlords had not been prosecuted and their default had arisen from ignorance rather than an intention to deliberately flout the law. The tenants’ complaints about the condition of the property were minor in nature. In the circumstances, the landlords were ordered to repay half the rent they had received during the relevant period, a total of £7,035.

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