HMO Property
We recommend reading our comprehensive guide on HMO investing to learn how it can generate more revenue and expand your property portfolio. If you require any assistance, please do not hesitate to contact our team of experts who are readily available to assist you in making informed investment decisions.
HMO investments can generate high rental returns by letting multiple rooms or units with shared facilities. Before investing, seek professional advice and ensure compliance with UK regulations. Our guide provides a useful starting point, and our experts are ready to assist you. Contact us for support.
An HMO is a property rented by multiple households. It has shared facilities like kitchens or bathrooms. A property with three or more tenants from different households is classed as an HMO. If it has five or more tenants, a licence is required. Renting by the bedroom often brings higher returns and reduces vacancy risks compared to single-family homes. Local authorities may require a licence for HMOs.
Benefits of Investing in HMO Property
Investing in an HMO property allows landlords to rent out multiple rooms, increasing rental income and expanding their portfolio.
This type of property often delivers higher returns while reducing the risk of empty periods.
Tenant demand remains strong due to the lower cost of entry. An HMO investment also provides tax benefits, as expenses such as marketing and repairs can be deducted from taxable
HMO properties are safer investments compared to single-family homes because they are rented out to multiple tenants, meaning there are fewer chances of not having anyone to rent them.
Investing in HMO property is a good way to diversify one’s portfolio and offer housing solutions to more tenant types. HMOs also generate higher rental income, making it easier to afford loan payments.
What kinds of accommodation to live are called HMOs?
An HMO refers to a property where three or more tenants rent and share facilities.
Various buildings can qualify as HMOs, including houses with separate bedrooms but shared communal areas, student accommodation, or converted flats that are not fully self-contained.
However, if a property consists of separate flats with no shared facilities, it does not qualify as an HMO. Instead, it falls under a Multi-Unit Block (MUB) or a Multi-Unit Freehold Block (MUFB).
What is Multi-Unit Freehold Block
A Multi-Unit Block (MUB) or Multi-Unit Freehold Block (MUFB) is a building divided into several flats, each with its own entrance and facilities. However, legally, it is treated as a single property.
If you plan to sell or mortgage a flat within a MUB/MUFB, the transaction will apply to the entire property. These types of properties can provide strong rental income, similar to Houses in Multiple Occupation (HMOs).
To sell each flat individually, you must establish and register a long leasehold with the Land Registry. A solicitor can assist with this process. If you invest in a large existing house, you can convert it into smaller flats to increase rental income.
Mortgage Advice..
Do you want a mortgage? Need advice on the best mortgage deal? Our expert team of mortgage advisors can help you with the advice and support you need. Contact us today for a free mortgage consultation and find out your options for a safe future. We know a lot about mortgages and we’ll make sure you get the right mortgage for you. Contact us now.
HMO Property Requirements and Standards
Different local authorities have specific requirements for HMO properties. Landlords and investors must research local regulations before proceeding.
HMO properties need extra management due to multiple tenants. Landlords must meet legal requirements and safety standards. Regular property inspections, fire safety measures, and written tenancy agreements are essential.
Licensing and planning permission may be necessary, depending on the number of occupants and the property’s size.
How Can We Help?
We help you secure finance for HMO or multi-unit properties. Our experience and industry connections ensure access to the best deals from specialist lenders. We guide you through HMO regulations, assist with applications, and offer expert advice. Contact us for HMO mortgage support and simplify your property investment journey.
Steps to Take
To invest in an HMO, research local laws and regulations. We help find lenders for HMO mortgages and multi-unit property loans. Our experts offer guidance on the loan application process to support successful HMO investments.
FAQ (Frequently Asked Questions)
You can check if a property has an HMO licence by contacting your local council or housing association office. They can tell you if the property has a license. Before investing in an HMO property, you should also find out about other regulations in your area. For example, there may be laws about how much rent you can charge or how many tenants are allowed in each unit.
Yes, you can buy a HMO property to live in. But you need to know what your mortgage lender requires. Also, check the local rules before renting out part of the property. Remember, owning an HMO property comes with additional costs such as repairs, maintenance, insurance policies, and various fees. So, make sure to consider everything before you buy.
HMOs are a good investment if you want to make more money quickly. They usually have more tenants than other rental properties, which means you can earn more money. HMOs are also more flexible with tenants, so you can make money in the short and long term. But you need to consider everything before investing, like insurance, repairs, and safety rules.
What next?
If you are looking for a mortgage solution that suits your needs and budget, we are here to help. Please visit our contact us page and fill out a simple form with your details and query.
We will get back to you as soon as possible with the best options for you. Thank you for choosing us as your mortgage partner.
