Housing Act 2004 by way of a number of tests to be applied to the property in question.
In the case of Global 100 Ltd v Jimenez and others, the First Tier Tribunal held that a commercial office building in which 10 – 12 property guardians were living was a House in Multiple Occupation (HMO) and should have been licensed as such. Subsequently, rent repayment orders were made.
Housing Act 2004 was satisfied. This standard test considers whether ‘occupation of the living accommodation constitutes the only use of that accommodation’ also known as the ‘sole use condition’.
Specifically, the Upper Tribunal held that ‘use’ and ‘purpose’ may sometimes be synonyms, but the question in this case was whether the property guardians’ occupation of their living accommodation at the property constituted its only ‘use’. The only thing the property guardians were entitled to do with the living accommodation was to use it as their main residence thus demonstrating the sole use condition. For this reason, amongst others, the rent repayment orders made by the First Tier Tribunal were confirmed.
What does this mean for the future of property guardians? Government guidance estimates that between 5,000 – 7,000 people are living as property guardians in the UK with several companies managing the schemes. The decision made in Global 100 Ltd v Jimenez and others means we will likely see an increase in HMO licences and as such, this will likely improve the rights of property guardians due to the conditions imposed by the HMO licences and the scope for additional conditions to be imposed by local councils.