What is the importance of an hmo
HMOs, House of multiple occupancy are generally defined as properties with a minimum of three individual tenants sharing kitchen, bathroom and toilet facilities. Tenants renting the rooms separately and not being connected.
Your responsibilities as a tenant
Depending on the type of HMO and its location, 5 or more rooms rented out in a single dwelling is classified as a HMO that needs licensing, rooms may be subject to minimum size guidelines or additional fire safety measures put in place.
Residents living near HMOs often complain about higher levels of noise, overflowing bins and parking requirements of multiple tenants. But occupants of HMOs also complain about substandard living conditions, unkempt communal areas and unresponsive landlords.
HMOs have taken a different level, it is getting harder to get on the property ladder and most professionals rent for many years and try to raise a deposit for their fist home. Therefore HMOs has emerged as the demand for affordable, yet high quality, shared housing increases. HMO landlords have been increasing the quality of the rooms accommodation and adding a wow factor to attract higher quality tenants and achieve the highest rent.
HMOs as investments
HMOs are easier to manage than several single-occupancy buy-to-let properties and provide landlords with the opportunity to maximise rental income from multiple rooms, while minimising the impact of voids and non-payment.
If you’re considering investing in HMOs, then it is important to commit yourself to producing high quality, fully compliant accommodation that attracts professional tenants who enjoy living in your properties.
What are the most common landlord mistakes
Your priorities must be how to achieve buy to let success
- Location – Most importantly, you’ll need to find out what legislation your local authority has in place for HMOs. It is also crucial to invest in a location that your ideal tenants would want to live in. Access to good transport links and local amenities will probably be important to them. You need to decide if you need a property manager to manage your HMO
- Type of property – If you’re not buying an existing HMO, you will need to look for properties that have the potential to be cost-effectively converted and accommodate the right amount of rooms and bathrooms at the right size. There are different advantages to being on the smaller and larger ends of the HMO scale, you can read about them here. Having local planning knowledge prior to a purchase is also essential, so do your research.
- Management – You should decide whether you would like to manage your HMO(s) yourself or employ an agent to do so. If it’s the former, you need to think about what kind of landlord you want to be, how much time you have and whether it is enough to effectively manage the property(ies). This can be the difference between you having loyal, long-term tenants and unhappy ones.
Electrical Safety Regulations for rental properties
However, HMOs are very complex and there are many risks involved. Without the right guidance and knowledge, you could easily purchase the wrong property for the wrong price, attract undesirable tenants and face fines if the right licensing isn’t in place. There is also limited advice available for inexperienced HMO investors.
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