2 Gray's Inn Square Chambers

Seminar Notes 03.11.05 Peter Leighton


Home Contact Find Us Members Practice Groups Direct Public Access Clerks & Admin Seminars Publications Recruitment Pupillage About Links

 
Seminar notes 23.11.05 sub-section
Housing Act 2004, Overview, Part I
 
Peter Leighton
speaker: Peter Leighton
   
Sub Index
(click on a topic to jump to relevant section)
 
 
 
 
 
 
 
   
 
 
Introduction and summary
       
1.
 The Housing Act 2004 (“the Act”) received Royal Assent on 18 November 2004. Most of the measures will come into force in April 2006 with full details being made available to the industry and local authorities as from November 2005 as part of a phased programme.  Schemes to safeguard tenants’ deposits will come into force from October 2006.
   
2.
 The Act consists of 270 sections organised into 7 parts

Part 1 - Housing conditions:
This replaces the existing housing fitness standard contained in the Housing Act 1985 (“fitness for human habitation”) with a risk assessment regime (“the Housing Health and Safety Rating System”). It also adapts and extends the powers of enforcement currently available to local housing authorities (“LHAs”) to tackle poor housing conditions. Some of the provisions of the 1985 Act will remain in that Act with appropriate amendments.
  Part 2 - Licensing of houses in multiple occupation (“HMOs”):
This introduces a mandatory scheme to licence HMOs. It is intended initially to apply this only to the larger HMOs of 3 or more storeys occupied by 5 or more people. LHAs are given power to extend licensing in their districts to other categories of HMO, subject to carrying out consultation and with the approval of the appropriate national authority.
  Part 3 - Selective licensing (other residential accommodation):
This introduces a power for LHAs to introduce selective licensing to deal with particular problems in an area. Selective licensing will be primarily focused on areas of low housing demand, or that are likely to fall into that category, and other areas suffering from anti-social behaviour. There is a discretionary power, subject to carrying out consultation and to the approval of the appropriate national authority, for LHAs to license all private landlords in a designated area with the intention of ensuring that a minimum standard of management is met.
  Part 4 - Additional control provisions (residential accommodation):
This contains provisions for enforcement action in respect of properties licensable under Parts 2 and 3, for individual properties where a residential property tribunal is satisfied that a property which is not required to be licensed requires the intervention of the LHA, enabling LHAs to take over the management of long-term empty properties and to bring them back into occupation, and in respect of overcrowding in non-licensable HMOs.
  Part 5 - Home information packs:
These impose new legal duties on people marketing residential properties in England and Wales. Before marketing a property, the seller or, more usually, the seller’s estate agent must have a home information pack of standard documents available for prospective buyers.
  Part 6 - Other provisions.  The Act also:
 
·
 gives LHAs further tools to tackle anti-social behaviour in social housing, designed to complement those introduced by the Anti-Social Behaviour Act 2003
 
·
 introduces changes to the Right to Buy (“RTB”) scheme
 
·
 contains provisions to protect caravan-park home owners
 
·
 extends eligibility for disabled facilities grant to include all those occupying caravans as their only or main residence
 
·
 requires LHAs to carry out assessments of the accommodation needs of Gypsies and Travellers in their district
 
·
 establishes tenancy deposit schemes.
  Part 7 - Supplementary and final provisions.
 
·
 The Act requires LHAs to keep registers of licences and management orders. It also provides for the approval of statutory codes of management practice, and for the making of management regulations, relating to HMOs.
   
 
 
 
Definitions
   
3.
 The following definitions are important:
 
a)
 Local housing authority is defined in section 261.
 
b)
 Home condition reports are defined in section 164 as documents which are prescribed by regulations under section 163 and dealing with the physical condition and energy efficiency of a residential property.
 
c)
 Home information packs are explained in Part 5 of the Act. In section 148 they are given a general description as a collection of documents relating to the property being sold, or the terms on which it is being offered for sale. The actual content of a home information pack for a particular property will be prescribed in regulations made under section 163 and for most purposes, the Act defines the pack as something that fulfils or purports to fulfil the requirements of these regulations.
 
d)
 Home inspector is not a term which is used in the Act, but it is used in these notes to describe a member of an approved certification scheme who may make home condition reports by virtue of section 164.
 
e)
 House in Multiple Occupation is defined in sections 254 to 260. Throughout these notes the abbreviation HMO has been used.
 
f)
 Interim Management Orders and Final Management Orders are covered by Chapter 1 of Part 4 of the Act. For the purposes of these notes, they are referred to as IMOs and FMOs. Interim empty dwelling management orders and final empty dwelling management orders are covered by Chapter 2 of Part 4 of the Act. For the purposes of these notes, they are referred to as interim EDMOs and final EDMOs. Throughout the notes the expression “management orders” refers to all the above orders made under Part 4.
 
g)
 Tenancy deposit schemes are covered in Chapter 4 of Part 6 of the Act. Throughout these notes, the abbreviation TDS has been used.
 
h)
 Residential property tribunal is defined in section 229 of the Act. Throughout these notes residential property tribunal has been abbreviated to RPT.
   
 
   
   
Part I - Housing Conditions
   
  The Housing Health and Safety Rating System ("HHSRS")
4.
 Section 1: introduces a new “rating” system for assessing housing conditions for enforcement of housing standards.
a)
 It replaces the existing system which is based on a test of fitness for human habitation under section 604 of the Housing Act 1985.
b)
 The purpose is to apply objective information to the taking of enforcement decisions by LHAs.
 
5.
 The new system operates by reference to the existence of certain types of hazard. “Hazard” means any risk of harm to the health or safety of an actual or potential occupier. There are 4 general types:
a)
 physiological;
b)
 psychological;
c)
 protection against infection;
d)
 protection against accidents.
 
6.
 Within those headings come 29 specific hazards:
  Physiological
·
 damp and mould growth
·
 excess cold
·
 excess heat
 
·
 asbestos
 
·
 biocides (chemicals used to treat timber and mould)
 
·
 carbon monoxide and fuel combustion products
 
·
 lead
 
·
 radiation
 
·
 uncombusted fuel gas
 
·
 volatile organic compounds (chemicals which produce fumes, eg glues)
     
    Psychological
 
·
 crowding and space
 
·
 entry by intruders
 
·
 lighting
 
·
 noise
     
    Protection against infection
 
·
 domestic hygiene, pests and refuse
 
·
 food safety
 
·
 personal hygiene, sanitation and drainage
 
·
 water supply for domestic purposes
     
    Protection against accidents
 
·
 falls associated with baths, etc.
 
·
 falls on level surfaces
 
·
 falls associated with stairs and steps
 
·
 falls between levels
 
·
 electrical hazards
 
·
 fire
 
·
 hot surfaces and materials
 
·
 collision and entrapment (eg trapping fingers or doors opening onto people)
 
·
 explosions
 
·
 ergonomics (inappropriate positioning of amenities, potentially causing injury)
 
·
 structural collapse and falling elements
     
7.
 A standard objective risk assessment is carried out. The extent of the hazard will be calculated on the risk to the most vulnerable potential occupant of that dwelling. Each hazard is given a score based on:
a)
 the likelihood of an occurrence,
b)
 the spread of possible harms, and
c)
 harm weightings.
 
8.
 The precise details are yet to be published but:
a)
 the total score (0 to 5,000) will determine the band into which the hazard will fall;
b)
 there will be 10 bands, “A” to “J”;
c)
 regulations will prescribe that hazards falling within bands A to C are category 1 hazards, while those within bands D to J are category 2 hazards;
d)
 a score of 1,000 or more is a category 1 hazard. 
 
9.
 A “category 1 hazard” means:
    “a hazard of a prescribed description which falls within a prescribed band as a result of achieving, under a prescribed method for calculating the seriousness of hazards of that description, a numerical score of or above a prescribed amount”.
   
10.
 A “category 2 hazard” means:
  “a hazard of a prescribed description which falls within a prescribed band as a result of achieving, under a prescribed method for calculating the seriousness of hazards of that description, a numerical score below the minimum amount prescribed for a category 1 hazard of that description”.
 
11.
 LHAs will have a general duty to take action to deal with category 1 hazards, and discretionary powers to take action to deal with category 2 hazards.
 
 
Inspection
12.
 If the LHA considers that it would be appropriate to inspect residential premises to establish whether or not there is a category 1 or category 2 hazard, the authority must arrange for an inspection to be carried out.
 
13.
 Inspections will be carried out by the EHOs.
 
14.
 Where an official complaint is made to a proper officer that a category 1 or 2 hazard may exist on residential premises or that an area should be dealt with as a clearance area, the proper officer must inspect the premises or area. An official complaint is a complaint made in writing by a local JP or a parish or community council.
 
15.
 Where an inspection is made following an official complaint and a category 1 or category 2 hazard exists a report in writing must be made to the LHA and the LHA must consider any such report as soon as possible.
   
   
  Enforcement
16.
 The enforcement action an LHA takes under the provisions of Part 1 will be based on:
a)
 the band into which the hazard falls as a result of the HHSRS calculation;
b)
 whether the LHA has a duty or a power to act;
c)
 the LHA’s judgement as to the best means of dealing with that hazard.
 
17.
 Category 1 hazards - enforcement options include:
a)
 an improvement notice under section 11, requiring works to remove the hazard;
b)
 a prohibition order under section 20, prohibiting the use of residential dwellings or part of a residential dwelling;
c)
 a hazard awareness notice under section 28, advising of hazard and recommending remedial action;
d)
 emergency remedial action under section 40; where there is imminent danger, the LHA will carry out emergency works;
e)
 an emergency prohibition order under section 43; where there is imminent danger, the LHA can the prohibit use of the property immediately;
f)
 a demolition order under section 265(1) or (2) of the 1985 Act;
g)
 declaration of a clearance area under section 289 (2) of the 1985 Act, under which designated areas will be demolished and redeveloped;
h)
 a determination under section 300(1) or (2) of the 1985 Act, enabling the LHA to purchase the property if the LHA considers the property is capable of providing adequate accommodation for temporary housing use.
 
18.
 The LHA is under a duty to take the best course of action available to it in relation to the hazard. LHAs cannot simultaneously take more than one of the actions.  An LHA can, however, take a different course of action if the initial action has not proved satisfactory.
 
19.
 Category 2 hazards - enforcement options include:
a)
 an improvement notice under section 12;
b)
 a prohibition order under section 21;
c)
 a hazard awareness notice under section 29;
d)
 a demolition order under section 265 (3) or (4) of the 1985 Act, but only in circumstances prescribed by the Secretary of State or, in relation to Wales, by the National Assembly for Wales;
e)
 include the premises in the declaration of a clearance area under section 289 (2ZB) of the 1985 Act, but only in circumstances so prescribed.
 
 
Reasons
20.
 LHAs must prepare a statement of reasons for their decision to take enforcement action. The statement should include an explanation as to why a particular course of action was taken rather than any of the other courses that were available.
 
21.
 A copy of the statement of reasons should be served on people who were served with the Part 1 notice or a copy of a Part 1 notice or order.
 
22.
 Statutory guidance will be made available to LHAs on the inspection of premises, the assessment of hazards on those premises (the technical guidance) and on the use of the enforcement functions (the enforcement guidance).
 
 
Consultation with fire authorities in certain cases
23.
 LHAs must consult the local fire and rescue authority before taking enforcement action in respect of a prescribed fire hazard in an HMO or in the common parts of a building containing flats.
 
 
Appeals
24.
 There is a right of appeal against an enforcement notice to a residential property tribunal. A tribunal may confirm, reverse/revoke or vary an enforcement decision.
 
 
 
 
Part 2 - Licensing of houses in multiple occupation
 
Generally
25.
 A building or part of a building is an HMO if it meets one of the following tests:
a)
 the Standard Test - any building in which two or more families/individuals share basic amenities
b)
 the Self-contained Flat Test - any flat in which two or more families/individuals share basic amenities
c)
 the Converted Building Test - any converted building which comprises of one or more units of accommodation that are not self-contained
d)
 certain converted blocks of flats - any converted building which comprises of self-contained flats that does not meet the 1991 Building Regulation Standards and more than one third of the flats are occupied on short tenancies.
 
26.
 Section 55: mandatory licensing of larger and higher risk HMOs.  LHAs are required to license the types of prescribed HMOs (initially those of 3 storeys and above occupied by at least 5 persons who constitute more than one household).
 
27.
 Section 56: discretionary licensing of other HMOs.  LHAs may license other categories of HMOs designated by it under an additional licensing scheme, as follows:
a)
 A LHA can designate part or all of its area as subject to additional licensing for specified types of HMOs.
b)
 A LHA must consider that a significant proportion of the HMOs (of the type it is considering licensing) are being managed ineffectively so as to give rise problems for the occupiers or members of the public.
 
28.
 Section 57 requires the LHA to:
a)
 consider its overall housing strategy, in particular whether it is part of a co-ordinated approach to deal with wider issues such as anti-social behaviour;
b)
 examine whether there are other courses of action that could be used to deal with the problems identified (eg voluntary accreditation schemes);
c)
 conclude whether additional licensing, whether on its own or in conjunction with other policies, will make a significant contribution to dealing with the problems.
 
29.
 Section 58: designations for additional licensing schemes need to be confirmed and publicised.
 
30.
 Section 60: a designation must from time to time be reviewed and can be revoked following a review, but in any case must end 5 years after it has been made.
 
 
Grant or refusal of licence
31.
 Section 63: a fee may be levied to cover the cost of the scheme.
 
32.
 Under section 64, a licence must be granted if:
a)
 the house is suitable for occupation by a certain number of persons or households as specified in the application or by the LHA, or can be rendered suitable for that number by imposition of conditions in the licence (see section 65 for tests of suitability);
b)
 the proposed licence holder is a fit and proper person (see section 66 for definition of “fit and proper”), as well as being the most appropriate person to be granted a licence, ie they have management responsibility and are locally resident.  This is intended to ensure that unfit landlords cannot use “front men” to apply for licences;
c)
 the proposed manager of the HMO is the person having control of the house or an agent or employee of that person and is also a fit and proper person; and
d)
 the proposed management arrangements are satisfactory.
 
33.
 Section 65 sets out what needs to be considered for a house to be suitable for occupation by a particular maximum number of households or persons. Regulations may prescribe minimum standards such as to the number, type and quality of toilets, washing facilities and food preparation facilities and certain other standards of facilities or equipment to be provided. An LHA may require different, but not lower, standards than those prescribed in the regulations when determining whether the HMO is reasonably suitable for the number of occupants.
 
34.
 Section 66 sets out the evidence that must be considered in determining whether someone is a fit and proper person to be a licence holder or a manager. These include whether that person (or a relevant associate eg a spouse or business partner) has committed offences involving fraud, dishonesty, violence, drugs or sexual offences. Spent convictions are not, in this context, taken into account. Evidence of unlawful discrimination in business, contravention of housing law or breach of any applicable code of practice (see section 233) is also relevant.
 
35.
 Under section 67 an LHA may include conditions in a licence relating to its management, use and occupation and its content and condition. Such conditions may include:
a)
 restrictions or prohibitions on the use of parts of the house by occupants;
b)
 requirements to take reasonable and practicable steps to prevent or reduce anti-social behaviour of the occupants or visitors;
c)
 installing and making facilities and equipment available in good working order to meet prescribed standards under section 65;
d)
 carrying out necessary works to such facilities and equipment within specified periods.
 
36.
 Under section 68, a person controlling or managing an HMO must have a separate licence for each property.  Each licence is valid for maximum of five years and licences are non-transferable.
 
37.
 Section 69 allows the local authority to vary a licence.
 
38.
 Section 70 provides for the circumstances in which an LHA may revoke a licence. These are:
a)
 with the agreement of the licence holder, eg if the house is converted to single occupancy;
b)
 where the licence holder has committed a serious breach of a condition of the licence or repeated breaches of such a condition;
c)
 where the LHA no longer believes that the licence holder is a fit and proper person; and
d)
 where the LHA believes the property is no longer meets the standards required for a licence.
 
 
Appeals
39.
 There is a right of appeal to the RPT against licence decisions.
 
Enforcement
40.
 Section 72 makes it an offence punishable by a fine of up to £20,000 if a person controlling or managing an HMO does not have the required licence. However, no offence is committed by a person who has an outstanding application either for a licence or for a temporary exemption.
 
41.
 An offence is also committed when a licence holder knowingly permits the HMO to be occupied by more persons than are permitted to occupy it under the licence. This too is punishable with a fine of up to £20,000. It is also an offence to breach any condition of a licence, punishable by a fine not exceeding level 5 (currently £5,000).
 
42.
 It is a defence for any of these offences if the person accused can demonstrate a reasonable excuse.
 
43.
 Section 73: a tenancy or licence in respect of an HMO remains enforceable, even if the landlord is required to obtain a licence under Part 2 of the Act but fails to do so. However, a landlord who receives rent while operating an unlicensed property:
a)
 could be liable to a penalty equivalent to any rent received during the period of the offence, up to a maximum of 12 months; and
b)
 could be subject to a “rent repayment order” from the RPT on the application of the LHA (if Housing Benefit has been paid) or an occupier who has paid money to the landlord.
 
44.
 Under section 74, where a landlord is actually convicted of an offence under section 72(1) and the LHA makes an application, the RPT is required to make a rent repayment order in respect of all Housing Benefit received by the landlord unless exceptional circumstances apply. In all other cases the RPT has discretion to make a rent repayment order for such an amount as is reasonable in the circumstances.
 
45.
 Section 75 states that a landlord who is required to have a licence in respect of an HMO, but who does not have a licence, loses the right to automatic possession by use of section 21 of the 1988 Housing Act in relation to assured shorthold tenancies.
 
   
   
   
 
Part 3 - Selective Licensing
 
46.
 In summary, selective licensing:
a)
 runs in parallel with mandatory licensing;
b)
 only applies to privately-rented accommodation (ie not LHAs or Registered Social Landlords); and
c)
 is targeted at areas:
 
i)
 of low housing demand, and/or
 
ii)
 a significant and persistent problem with anti-social behaviour where the inaction of private landlords is a contributory factor.
 
47.
 Generally:
a)
 In order to designate in the case of low housing, the LHA must believe that the designation, together with other measures, will help lead to an improvement in the social or economic conditions in the area.
b)
 In order to designate in the case of anti-social behaviour, the LHA must believe that the designation, together with other measures, will help lead to a reduction in or elimination of the problem of anti-social behaviour.
c)
 Before making a designation an LHA must consult with those likely to be affected by it and take account of any representations.
48.
Section 81 - further requirements:
a)
 The LHA must ensure the use of selective licensing is in accordance with the LHA’s overall housing strategy and is part of a co-ordinated approach to deal with wider issues such as anti-social behaviour.
b)
 The LHA must examine whether there are other courses of action that could be used to deal with the problems identified (eg voluntary accreditation schemes) and consider whether additional licensing, whether on its own or in conjunction with other policies, will make a significant contribution to dealing with the problems.
 
49.
 The provisions as to the grant and refusal of licences, appeals and enforcement mirror those in the discretionary scheme.
 
 
 
 
Part 4 - Additional Control Provisions
 
Interim and Final Management Orders
50.
 Section 101 - Management orders are designed to allow an LHA to step into the shoes of a private landlord and manage his property where he cannot be licensed or where there is some management problem which requires intervention by the LHA.
 
IMOs
51.
 When an IMO is in force:
a)
 the LHA takes over most of the rights and responsibilities of the landlord including (subject to the rights of existing occupiers) the right to possession of the dwelling;
b)
 the LHA does not become the legal owner of the dwelling but, with the consent of the landlord, the LHA may grant occupation rights;
c)
 the LHA acts, effectively, as a receiver;
d)
 the landlord is no longer entitled to receive any rent from occupiers of the house, may not exercise any management functions in respect of it and may not grant any tenancies;
e)
 the landlord may sell the house and the rights of a mortgagee are unaffected;
f)
 an IMO is a local land charge and the LHA can apply to HM Land Registry for a restriction on dealing with properties subject to the order.
 
52.
 Section 102 sets out the circumstances in which an IMO must or can be made. An IMO must be made when:
a)
 a Part 2 HMO or a Part 3 house ought to be licensed but is not and either there is no reasonable prospect of the house becoming licensed in the near future or the health and safety condition is met (see section 104); or
b)
 the LHA intends to revoke an existing licence and either there is no prospect of a new licence being issued in the near future or the health and safety condition is met.
 
53.
 Section 104 defines the “health and safety condition” for the purposes of Section 102. The condition is satisfied when it is necessary to make an IMO or FMO in order to protect the health, safety and welfare of the occupiers of the house or persons occupying or owning property in its vicinity.
 
54.
 The condition can be satisfied if there is a threat to evict occupiers in order to avoid licensing under Part 2. It cannot be met where the threat relates to a category 1 or 2 hazard under Part 1 and the appropriate course of action is to take enforcement action under that Part.
 
55.
 The LHA can apply to the RPT for authority to make an IMO for an HMO that is not licensable. In deciding whether to authorise the making of the order, the RPT must be satisfied that the health and safety condition (see section 104) is satisfied and must also have regard to the degree to which the management of the HMO has been in compliance with any approved code of practice made (under section 233).
 
56.
 Section 105 provides that an IMO normally comes into force when it is made and ceases to have effect after 12 months, unless it provides for an earlier end date, or it is continued in force pending the disposal of an appeal against the making of an FMO.
 
57.
 Section 106 sets out the LHA's obligations after making an IMO:
a)
 to ensure the health and safety of occupants; and
b)
 to sort out long term management arrangements for the property:

Where the house is licensable the LHA must grant a licence or make an FMO.
Where the house is not licensable, the LHA must consider whether it should make an FMO or revoke the IMO and take no further action.
 
58.
 The duty to sort out the long term management arrangements must be complied with as soon as is practicable.
 
 
FMOs
59.
 Section 113 provides that the LHA:
a)
 must make an FMO if the house is licensable under part 2 or 3 and, when an IMO is ending, the LHA cannot grant a licence; and
b)
 may make an FMO for a non-licensable house where an IMO is ending and the LHA considers it necessary.
 
60.
 The general effect of an FMO is the same as for an IMO except that the LHA does not require the consent of the landlord to grant occupation rights during in the time before the order is due to expire.
 
 
Interim and Final Empty Dwelling Management Orders
61.
 Section 132 explains the nature of interim (“interim EDMOs”) and final empty dwelling management orders (“final EDMOs”). EDMOs are similar to management orders under Chapter 1 of Part 4. They enable a local housing authority to step into the shoes of owners of unoccupied dwellings to secure the dwellings’ occupation. The most significant difference in practice between interim and final EDMOs (apart from the period of time for which they may be made) is that under an interim EDMO, the local housing authority must obtain the consent of the owner before it can grant anyone a right to occupy the dwelling, whereas under a final EDMO, such consent is not required.
 
62.
 An EDMO is made against the person with the most relevant interest in the dwelling (the “relevant proprietor”). Where the dwelling is not subject to any lease, the relevant proprietor is the freehold owner. Where the dwelling is subject to a lease, the relevant proprietor would be the leaseholder with the shortest unexpired term, provided it still has more than 7 years to run.
 
63.
 Where the dwelling is subject to a lease that has less than 7 years left to run, the relevant proprietor would be the next person up in the chain of ownership with a lease of more than 7 years or, if there is no such superior lease, the freeholder. Any other person with an interest in the dwelling is treated as a “third party” to an EDMO.
 
64.
 An LHA must apply to a RPT for authorisation to make an interim EDMO. An RPT may authorise it on the terms requested or may vary those terms. The dwelling must be wholly unoccupied (eg not occupied either lawfully or unlawfully) and not owned or controlled by a public body.
 
65.
 Before seeking such authorisation, a LHA must make reasonable efforts to notify the relevant proprietor and ascertain if he intends to take steps to bring the dwelling back into occupation and must take into account the rights of the relevant proprietor and the interests of the wider community.
 
66.
 When applying for authorisation to make an interim EDMO, a LHA may also ask the RPT to make an order to terminate an existing lease or licence of the dwelling. This allows for termination of a lease or licence where the dwelling is not being occupied, eg if the relevant proprietor has granted a right of possession of the dwelling to someone who has no intention of occupying it as a device to avoid an EDMO being made.
 
67.
 This sets out the matters which a RPT must consider in deciding whether to authorise an application by a LHA to make an interim EDMO. It must be satisfied that:
a)
 the dwelling has been unoccupied for at least six months or such longer period of time as may be prescribed by an order made by the appropriate national authority;
b)
 if the order is not made there would be no prospect of the dwelling becoming occupied in the near future;
c)
 if the order is made the dwelling is likely to become occupied;
d)
 the local authority has complied with its duties under section 133 in seeking to make an interim EDMO; and
e)
 any requirements which may be prescribed by a further order made by the appropriate national authority have been complied with.
 
68.
 The RPT must also take into account the effect that making the order is likely to have on the community and the rights of the relevant proprietor and third parties. The LHA must consider if it should pay compensation to any third parties for interference with their rights.
 
69.
 The following are exempted:
a)
 the principal homes of absent owners;
b)
 second homes and holiday homes;
c)
 homes undergoing repairs or renovation or awaiting planning or building regulations approval;
d)
 homes on the market for sale or letting; and
e)
 homes where the relevant proprietor died less than a specified period of time before the application for an order was made.
 
70.
 Once an interim EDMO has been authorised, the LHA is required to take any steps it considers appropriate to secure occupation and proper management of the dwelling pending either the making of a final EDMO or the revocation of the interim EDMO. If it concludes that there are no steps it could take, it must either make a final EDMO or revoke the interim EDMO without taking further action. For example, if the LHA was unable to secure occupation of the dwelling because the relevant proprietor refused to give consent to allow the dwelling to be occupied, it might conclude that the only reasonable course of action open to it would be to revoke the interim EDMO and make a final EDMO. However, if the relevant proprietor gave consent but the LHA concluded that the cost of works to make the dwelling habitable would be prohibitive, it might conclude that the only reasonable course of action would be to revoke the interim EDMO and take no further action.
 
71.
 A LHA may make a final EDMO either to replace an interim EDMO or to replace a previous final EDMO that has expired if it considers the dwelling is likely to become or remain unoccupied if it did not do so. But it cannot do so if the dwelling is unoccupied, unless it has taken reasonable steps to secure its occupation whilst the previous EDMO was in force.
 
72.
 The LHA must take into account the effects that making the order is likely to have on the community and the rights of the relevant proprietor and third parties. The LHA must consider if it should pay compensation to any third party for interference with their rights.
 
73.
 The procedure for making a final EDMO is equivalent to that for making an FMO with some minor modifications, principally to ensure that third parties are served with relevant notices.
 
74.
 Once a LHA has made a final EDMO it must take steps to secure that the dwelling is occupied and properly managed in accordance with the management scheme contained in the order. However, unlike an interim EDMO, it does not require the consent of the relevant proprietor to grant rights of occupation.
 
75.
 A final EDMO must contain a management scheme (see paragraph 13 of Schedule 7).
 
76.
 An LHA must from time to time review: