Victory For Landlords In High Court Judgement On HMO Property Investment

A High Court bid by three councils has failed in its aim of quashing rules that make it easier for landlords to set up houses in multiple occupation (HMOs).

Milton Keynes, Oxford and Newcastle councils had presented a case that creating more HMOs would result in more crime, anti-social behaviour and traffic problems. Together, they brought a judicial review challenge to regulations that allow homes to be converted into HMOs without planning permission.

The basis of the councils' argument was that the government had not had a proper consultation on the rules prior to their introduction on 1 October 2010. The challenge was recently rejected in the High Court by Judge Sir Michael Harrison who ruled that the consultation process was not ‘so unfair as to be unlawful’.

He noted that the change in regulations followed a consultation by the Labour government on HMOs and the coalition government carried out a smaller consultation with bodies such as the Local Government Association in 2010.

The judge commented: “It was not in my view unreasonable for the defendant to decide to ballot representative bodies rather than to consult local planning authorities directly. In my judgement the consultation exercise was not so unfair as to be unlawful.”

He also noted that councils are able to use their own powers on permitted development to override the central government regulations, as all three have in fact done so. Milton Keynes has done this with immediate effect despite a risk of potential compensation claims.

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