Mortgages for Houses in Multiple Occupation
Types of accommodation operated as Houses of Multiple Occupation
- Houses converted into bedsits
- Shared houses with single or multiple AST's
- Shared self-contained or cluster flats
- Blocks of converted flats
- Privately operated student halls accommodation
- Worker or employee accommodation
- Lodging houses
- Converted B&Bs
- Asylum seeker or migrant accommodation
- Dormitory type accommodation
Do all HMOs need a licence?
Under updated legislation contained in the Housing Act 2004, other forms of shared housing such as student share houses will be classified as HMOs however not all housing will require mandatory HMO licencing. Larger properties with 3 storeys or more and with 5 or more occupants will require a mandatory HMO licence. So while a property may fall under the definition for a HMO not all will require to be licenced as such, however it will still be subject to HMO legislation to ensure important matters concerning occupant safety are adhered to as well as being subject to the Housing Health and Safety Rating System (HHRSS).
Distinction between HMO commercial mortgage and buy-to-let HMO lending
What is the definition of a HMO
For premises to be defined as a HMO there must be at least three unrelated persons involved who do not form a single household. Where there are two or more separate households residing within the property as their main residence then the property will be an HMO. All of the occupiers occupy the property do so on the basis that is is their main residence and the accommodation used for residential purposes only.
Common HMO types
- A house share or flat share
- Student accommodation
- A converted house split into bedsits
- A converted house with mixed accommodation types
When there are more than one household renting a property, lenders will regard this as a ‘multi-let’ property which will dictate the type of mortgage they can offer.
HMO Mortgage highlights
- Property refurbishment mortgages
- Licensed or un-licensed HMOs
- HMOs above retail premisis
- Student let property
- All property types considered
- Whole of market product selection
- Vast industry experience over 25years in financial services
- Free No Obligation Quotes
HMO Mortgage Lenders
We have access to the whole of the market to provide landlords mortgages for properties let as HMOs. Lenders we utilise range from mainstream Buy-to-let mortgage lenders to Commercial mortgage lenders offering finance for large HMO properties. We also arrange short-term and mortgage finance for converting existing dwellings into HMOs or converting property into self-contained flats.
Lending throughout England, Scotland and Wales. We can also arrange mortgage for properties located in Northern Ireland.
Mixed accommodation converted building HMOs
Many landlords have converted large single dwellings into HMO type accommodation for increased rental yields. Often these may comprise of a mix of self-contained flats, bedsits and other non-self-contained letting units and will be subject to HMO legislation. Converted buildings comprising only self-contained flats, while having no shared facilities other than stairways and common access areas with the other units will usually fall under the same legislation. Converted buildings operated as HMOs may provide shared bathrooms and laundry facilities with the
Large HMO Definition
A house in multiple occupation is a property rented out by at least 3 people who are not from 1 ‘household’ (eg a family) but share facilities like the bathroom and kitchen. It’s sometimes called a ‘house share’.
You must have a licence if you’re renting out a large HMO. Your property is defined as a large HMO if all of the following apply:
- it’s rented to 5 or more people who form more than 1 household
- it’s at least 3 storeys high
- tenants share toilet, bathroom or kitchen facilities
For licensing purposes a household refers to members of the same family living together and couples who live together (whether or not they are married). A group of friends sharing does not constitute a single household.