HMO landlords who are not up to scratch with new laws face punitive fines and expensive restructuring work.
Research by Simple Landlords Insurances reveals more than 85 per cent of landlords are unfamiliar with new laws set to come into effect next year.
New proposals mean landlords of homes of multiple occupancy will require new licences.
Some 60,000 HMOs currently require a licence. A further 174,000 properties could need one under proposals which aim to improve housing conditions.
The proposals could impose minimum standards o room sizes, storage facilities and waste disposal.
They would apply to all HMOs including conversions and properties of multiple use. Previously only HMOs of three stories or more have required a licence.
Some 40 per cent of HMO landlords are unaware of the changes or not sure of the details.
Under new rules local councils would have powers to adjust the minimum standards and licensing fees.
Landlords who fail to get to grips with the new rules could be left with rooms they can no longer rent or even face fines.
Simple Landlords Insurance head of operations Alex Huntley says: “As the six month countdown to these changes begins, we would like to see more clarity from government so landlords aren’t caught unawares.”
These changes, expected to be introduced in April 2018, are the latest upheaval landlords face. Already they have had to deal with increase stamp duty and changes to mortgage interest tax relief.
Home Safe Scheme founder Carl Agar says: “The good news is there’s likely to be a six-month grace period for landlords to catch up with new legislation. Transferring from an unlicensed property to a mandatory one is also likely to be pretty simple. HMOs can still be a very good investment, in the right area, targeting the right audience and managed closely.”