Managing a House in Multiple Occupation (HMO) requires more than just handing over the keys when a new tenant moves in. If you're a landlord dealing with changes in an HMO, it’s essential to understand the process to avoid costly mistakes. Here’s a guide on how to manage tenancy changes effectively.
Understanding the Challenges of HMO Tenancies
In an HMO, tenants often move in and out more frequently due to job changes, relationships, or other personal circumstances. These mid-tenancy changes require careful management to avoid potential legal pitfalls.
Informal agreements between tenants to swap one tenant for another might seem harmless, but they can lead to serious complications. Such changes, commonly referred to as ‘changes of occupancy,’ can inadvertently result in the surrender and regrant of the tenancy. This means that replacing one tenant, even if the others remain, effectively ends the existing tenancy and creates a new one. For landlords, particularly those who self-manage their properties, this can bring unexpected legal challenges.
The Legal Implications
When a new assured shorthold tenancy begins, landlords must adhere to several legal requirements. For instance, if a deposit is taken, it must be protected, and certain information—known as "prescribed information"—must be provided to the new tenants within a legally mandated time frame. Additionally, landlords must verify Right to Rent documents and, if applicable, provide gas safety certificates to new tenants.
Failing to handle changes of occupancy correctly triggers these compliance requirements all over again. Landlords who don’t comply face hefty fines and may also lose their right to reclaim possession of their property on time. If a new tenancy is created, a no-fault eviction order cannot be issued until six months after the start of the new tenancy. This can prevent landlords from regaining possession of their property when planned, whether for personal use or for a relative.
Avoiding the Headache
The good news is that these issues can be avoided with the correct approach. Changes of occupancy should be executed properly and by deed. When done correctly, landlords can rest assured that the original tenancy timeline remains unchanged and that all compliance measures from the beginning of the original tenancy are still valid.
At Fortess Homes Estate Agent, we can manage this process for you. Contact our property management team today to ensure you stay compliant and avoid unnecessary complications.
