Do you have an HMO tenant or lodger situation?

We had an interesting query recently over whether someone was a lodger or a tenant. The question was then whether to use our lodger template or our licence to occupy residential property for an HMO situation (house-in-multiple-occupation). The relevant facts were:

• there was a large residential property with multiple bedrooms;
• several lodgers were taken in at a time;
• lodgers were taken in regularly;
• the landlord and his or her family were living in the house; and
• there were shared living rooms, kitchens and bathrooms (i.e. shared by the lodgers and the landlord’s family).

Two key requirements for a lodger situation are:

• you must share at least one key room, from living room, kitchen and bathroom; and
• the landlord and/or his or her family member(s) must be living in the house.

The case study met these requirements. The temptation was therefore to go for a lodger agreement, as the eviction process is much quicker and simpler.

The differences with evicting a tenant or lodger

As a landlord of a genuine lodger who is in breach of the lodger agreement, you can simply:

• give notice; and
• then change the locks while they are out.

There’s not the protection from eviction that a normal residential tenant enjoys, nor is such a quick eviction a criminal act when the person is genuinely a lodger.

If treating the person as a normal tenant, then for a breach of the agreement the eviction process would be much more laborious and costly. You would always need a court order. In the current climate, this could take months, as the civil courts (other than family courts) are practically inoperative currently, due to the Coronavirus disruption (or maybe that’s just their excuse for terrible service!).

Running a business

However, the key fact in this example was that the landlord habitually took in people, and several at a time. Effectively this was a business operation, and not a one-off or rare situation. (For a genuine lodger situation the latter is essential.) As a result, the landlord should treat them as normal tenants in an HMO situation, and should not class them as lodgers. The longer eviction process would apply.

So restrict lodger situations to ones where you have one or two spare rooms, used occasionally for short-term lodgers.

For the HMO situation, our licence to occupy residential property template can be used. Click on the link for more information about the template. We also have versions where a guarantor stands with the tenant or lodger:

• Lodger agreement with guarantor; or
• Licence to occupy residential property with guarantor.