HMO Jargon

There is lots of HMO Jargon associated with the HMO property industry, so we’ve put together this handy page that details all associated terminology, jargon, acronyms and abbreviations that get used, to help get investors some clarity.

If you think of any more then drop us a line and we’ll update accordingly.

TermAbbreviationMeaning
Asset of Community ValueACVLand or property of importance to a local community which is subject to additional protection from development under the Localism Act 2011.
Alternative Dispute ResolutionADRThe use of methods such as mediation or arbitration to resolve a dispute without the need for litigation.
Association of Plumbing and Heating ContractorsAPHCA trade association for the plumbing and heating industry in England and Wales.
Association of Residential Letting AgentsARLAA professional body for individuals working in residential property lettings and management in the United Kingdom.
Article 4A4A directive that removes permitted development rights within a specified area designated by the local authority.
Assured Shorthold TenancyASTThe default legal category of residential tenancy in England and Wales. See Housing Act 1988 & Housing Act 1996.
Assured TenancyATA legal category of residential tenancy to an individual in English land law.
Building Cost Information ServiceBCISA part of RICS, providing cost and price information for the UK construction industry.
Below Market ValueBMVA term refering to a property that is priced below the current market value
Valuation: Bricks & MortarB&MVThe valuation prescribing a properties value in a residential category
Buy-to-LetBTLA British phrase referring to the purchase of a property specifically to let out, that is to rent it out.
Build-to-RentBTRA market within private rental residential sector, designed specifically for renting, typically owned by institutional investors.
Buy-to-SellBTSPurchasing a property with the express intention of selling it.
Consumer Credit ActCCAAct of the Parliament of the United Kingdom intended to increase consumer protection when borrowing money.
Construction Design and ManagementCDMRegulations governing the way construction projects of all sizes and types are planned.
Community Infrastructure LevyCILA planning charge, introduced by the Planning Act 2008 as a tool for local authorities in England and Wales to help deliver infrastructure to support the development of their area.
Construction Industry SchemeCISUnder this scheme, contractors deduct money from a subcontractor's payments towards the subcontractor's tax and NI.
Capital Gains TaxCGTThe profit realized on the sale of a non-inventory asset that was greater than the amount realized on the sale.
Council for Mortgage LendersCMLAn industry body representing mortgage lenders in the United Kingdom.
Commercial ValuationCVIncludes the general valuation of portfolios of property, monthly valuations, loan security work and investment valuation.
Deed of TrustDoTA legally-binding document that records the financial arrangements between joint owners of a property, and/or anyone else who a financial interest in the property.
Deposit Protection ServiceDPSA government-backed tenancy deposit scheme ( TDP ) if a property is rented on an assured shorthold tenancy that started after 6 April 2007.
Environmental Health OfficerEHOThe council representative responsible for protecting public health, administering and enforcing legislation, to maximise health and safety hazards.
Enterprise Investment SchemeEISOne of the UK Tax reliefs launched in 1994 in succession to the Business Expansion Scheme. Designed to encourage investment in small companies carrying out a qualifying trade in the UK.
Energy Performance CertificateEPCA rating scheme to summarise the energy efficiency of buildings in the European Union.
Financial Conduct AuthorityFCAA financial regulatory body in the United Kingdom, but operates independently of the UK Government, and is financed by charging fees to members of the financial services industry.
Fire, Lightening, Explosion, Earthquake & Aircraft InsuranceFLEEAInsurance cover for Fire, Lightening, Explosion, Earthquake and Aircraft impact, but no other perils. Some timesissued for a property that has been empty for some time.
Fire Risk AssessmentFRAA process involving the systematic evaluation of the factors that determine the hazard from fire, the likelihood that there will be a fire and the consequences if one were to occur.
Financial Services Compensation SchemeFSCSThe UK’s statutory Deposit insurance and investors compensation scheme for customers of authorised financial services firms.
First Time BuyerFTBA person buying a house or flat who has not previously owned a home and therefore has no property to sell.
General Data Protection RegulationGDPRA regulation in EU law on data protection and privacy for all individuals within the European Union (EU) and the European Economic Area (EEA).
Gross Development ValueGDVThe projected value of a property development once completed.
House of Multiple OccupationHMOA British English term which refers to residential properties where 'common areas' exist and are shared by more than one household.
HMO LicenceN/AThe licence required to legally operate a house of multiple occupation
HMO ArchitectN/AAn architect with a specialisation or experience in HMO property
HMO Planning ConsultantN/AAn planning consultant with a specialisation or experience in HMO property
HMO InsuranceN/ASpecific property insurance for an HMO property.
High Net Worth IndividualHNWIA certified individual who has a minimum income of £100,000, or net assests of £250,000 excluding primary residence (or money raised through loan a secured on that property).
Interest Cover RatioICRA ratio used to determine how easily an entity can pay their interest on outstanding debt.
Independent Financial AdvisorIFAProfessionals who offer independent advice on financial matters to their clients and recommend suitable financial products from the whole of the market.
Inheritance TaxIHTThe standard Inheritance Tax rate is 40%, only charged on the part of the estate that's above the threshold.
Joint Contracts TribunalJCT (contract)Produce standard forms of construction contract, guidance notes and other standard forms of documentation for use by the construction industry. (Source: JCT)
Joint VentureJVA cooperative enterprise entered into by two or more business entities for the purpose of a specific project or other business activity.
Joint Venture AgreementJVAAn arrangement where two companies develop a new entity to their mutual benefit. It could involve sharing of resources, e.g capital, personnel, physical equipment, facilities or intellectual property.
Approved Code of Practice - L8L8 ACOPThe guidelines concerning legionella control are included in the Approved Code of Practice L8 2-13- The Control of Legionella Bacteria in Water Systems (ACOP L8).
Local Housing AuthorityLHAA governmental body that governs aspects of housing, often providing low rent or free apartments to qualified residents.
London Inter-Bank Offered RateLiborThe interest-rate average calculated from estimates submitted by the leading banks in London.
Limited Liability PartnershipLLPA partnership in which some or all partners have limited liabilities.
Loan To ValueLTVThe financial term used to express the ratio of a loan to the value of an asset purchased.
Minimum Viable ProductMVPA product with just enough features to satisfy early customers, and to provide feedback for future product development.
National Approved Letting SchemeNALSA well-respected organisation recognised by Government, tenant and landlords organisations alike and is the only agent organisation whose sole focus is consumer protection.
National Landlords AssociationNLAThe UK's largest membership organisation for private residential landlords, supporting and representing 40,000 members.
Open Market ValueOMVThe estimated amount that a property would sell for in a given time period.
Office for National StatisticsONSThe executive office of the UK Statistics Authority, a non-ministerial department which reports directly to the UK Parliament.
Purpose-Built Student AccommodationPBSAA community designed for residents in higher education. They offer amenities tailored to students, including individual leases, study areas, fully furnished units, and room-mate matching.
Permitted DevelopmentPDWhere certain types of work can be performed on a building without needing to apply for planning permission.
Purchase Lease OptionPLOWhere a traditional rental agreement is combined with an exclusive right of first refusal and option, for the future purchase of a property.
Project ManagerPMThe person in overall charge of the planning and execution of a particular project.
Private Rented SectorPRSProperty owned by a landlord and leased to a tenant.
Rent-to-RentR2RWhere an individual or company takes an interest in a property for a period of time from a landlord and guarantees to pay a fixed rent to the landlord.
Rent Guarantee InsuranceRGIA form of insurance where, for a relatively small annual fee, landlords can protect against loss of rent.
Royal Institute of Chartered SurveyorsRICSA professional body promoting and enforcing the highest international standards in the valuation, management and development of land, real estate, construction and infrastructure.
Residential Landlords AssociationRLAThe national voice for landlords, representing over 35000 landlords, the RLA is a leading landlord association in the UK.
Return on InvestmentROIMeasures the gain or loss generated on an investment relative to the amount of money invested, usually expressed as a percentage
Restriction;RX1The form used to register an application to the Land Registry to place a restriction on the legal title of a property to protect the interests of a third party.
Section 8S8A section 8 notice is served on the tenant by a landlord wishing to regain possession of a property during the fixed term of an Assured Shorthold Tenancy (AST).
Section 21S21A section 21 notice is the legal eviction notice a landlord can give to a tenant to regain possession of a property at the end of an Assured Shorthold Tenancy (AST).
Section 24S24This is restriction of relief for finance costs on residential properties to the basic rate of Income Tax, being introduced gradually from 6 April 2017.
Section 106S106Agreed during the planning process these are obligations and private agreements made between local authorities and developers.
Serviced AccommodationSAA fully furnished apartment available for short-term or long-term stay, providing hotel-like amenities such as room service, house keeping, a fitness center, a laundry room, and a rec room.
Standard Assessment ProcedureSAPThe UK government's recommended method system for measuring the energy rating of residential dwellings.
Stamp Duty Land TaxSDLTA tax on properties bought in England and Northern Ireland, paid when a residential property that costs more than £125,000 is transacted.
Sophisticated InvestorSIAn individual who has a written sophiscated investor certificate from a FCA firm confirming they are sufficiently knowledgeable to understand the risks associated with engaging ininvestment activity.
Small and Medium-sized EnterprisesSMEA term for segmenting businesses and other organizations that are somewhere between the "small office-home office" ( SOHO ) size and the larger enterprise .
Statutory Periodic TenancySPTWhat happens to an assured or assured shorthold tenancy when the tenancy ends.
Special Purpose VehicleSPVA structure, usually a limited company, used when more than one person invests in a property, whereby the legal status of the SPV protects the interests of each investor.
Sold Subject To ContractSSTCWhen a property has had an offer accepted from a buyer but has not yet exchanged contracts.
The Property OmbudsmanTPOAn ombudsman in the United Kingdom, that has been providing consumers and property agents with an alternative dispute resolution service since 1990.
UK Association for Letting AgentsUKALAA UK Association for Letting Agents offering a low-cost monthly instalment plan to help manage the cost of running your business.
Unique Selling PointUSPA factor that differentiates a product from its competitors, such as the lowest cost, the highest quality or the first-ever product of its kind.
Valuation Office AgencyVOAAn executive agency of Her Majesty's Revenue and Customs. The Agency values properties for the purpose of Council Tax and for non-domestic rates in England and Wales.

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