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Article > How Can You Tell If A Property Can Be Used As a HMO? - Part 1



Article kindly supplied by Matthew Moody

www.Millenniaproperty.co.uk

www.hmosurvivalguide.com

 

 


This is an interesting one - and a question I get asked ALL the time!

There's basically a couple of schools of thought on this and the simple answer is - it all depends on how much cashflow you want to make!

Generally speaking; when you convert a property into a HMO, you normally include the bills as part of your rent. Now given that bills can be as much as £130 per tenant per month, you need to make sure that you will be generating sufficient cashflow to cover this cost.

I generally look at it from the point of view of rooms being boxes - so a 4 bedroom house with 2 reception rooms would be for me a 5 box house. 3 of the boxes would cover my mortgage, the 4th box the bills and the 5th box is PURE cashflow to you.

The official definition of a HMO classifies any property where two or more unrelated people are sharing but this covers everything from a flat with two flat mates right up to a 20 bedroom HMO!

 

HMO Survival Guide

If you're serious about your property business in 2014, you will get this report, right now and read the report today.

Imagine, month after month, having dozens of £400 deposits in your bank account,with almost no chasing the rent and little tenant support—ever. What an easy way to earn a living that would be! You can have that life. I'll show you how.

  • Why HMO's Are The Perfect Property Investment
  • HMO's Are Not Problem Free
  • Why HMO's Are More Than Just a HMO
  • The HMO Survival Guide
  • Managing Your HMO Effectively
  • Make Money With This Report

Here are some tips that I use when determining whether a HMO is going to work or not:-


1. How near is it to a shop, local amenities, bus route or any sign of life?
Its no use buying a lovely large house in a village or a field or a suburb that is miles from the city centre - room sharers are generally not going to be interested

2. Does it have enough reception rooms that I can keep one free for the sharers to use as a communal living area?
You don't need to do this but do you want to be a landlord who isn't keen on maintaining standards and isn't interested in making sure their tenants are looked after? Would you want to live in a 10 foot square room with only a kitchen and bathroom to congregate in - I wouldn't

3. Does it have enough parking for at least half of the rooms you intend to let out?
You can get away with on-street parking but only in a quiet street where there is plenty of parking (I have one or two where it works). Generally, the more off-road parking you are, the more attractive this will be and especially to those higher paying professional tenants.

4. Is it attractively presented from the outside?
Like it or not, a tenant is sold on the house from appearances and first appearances count. If you have weeds growing everywhere, rotten window sills and paint peeling from the door - your prospective tenant is going to think - uh oh, if its this bad outside, what will it be like inside!

 

HMO Survival Guide

If you're serious about your property business in 2014, you will get this report, right now and read the report today.

Imagine, month after month, having dozens of £400 deposits in your bank account,with almost no chasing the rent and little tenant support—ever. What an easy way to earn a living that would be! You can have that life. I'll show you how.

  • Why HMO's Are The Perfect Property Investment
  • HMO's Are Not Problem Free
  • Why HMO's Are More Than Just a HMO
  • The HMO Survival Guide
  • Managing Your HMO Effectively
  • Make Money With This Report

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Matthew Moody

About The Author:

Matthew Moody is one of the UK’s top HMO experts and the founder of www.yourhmoexpert.com a website dedicated to providing property investors with free information about investing in high quality professional HMO’s.
He runs regular workshops and speaks at events around the country.
He also runs a HMO management agency with offices in Northampton, Leeds, Lincoln, Hemel Hempstead and Colchester together with a property sourcing and education business, and a furniture package supplier.

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