Thinking of changing to HMO?
You could gain up to double your income from a single property!
Landlords face rising expenses. Professional property investors constantly search for a “High Yield” income. Increasingly, landlords and property owners turn to HMO or Houses in Multiple Occupation to maximise their return on investment. The financial rewards of building a HMO portfolio are considerable.
What is a HMO?
HMO – or Houses in Multiple Occupation – under section 254 of the Housing Act 2004, is:
- A property rented out by at least THREE people who are not from the ONE same ‘household’ (e.g. a family) but SHARE one or more facilities, usually the bathroom, kitchen, lounge and dining area. Also referred to as a ‘house share’.
A property is categorised as a HMO where there is “material sharing” of amenities, such as :
- A house split into bedsits where the tenant has sole use of their own private room but shares a kitchen or bathroom and WC.
- Students living in shared accommodation where they have exclusive use of the whole house.
- An owner-occupier with more than 2 lodgers who have a licence to occupy their accommodation.
A property classed as a HMO is not dependent on planning permission but on how
the house is occupied.
HMO Landlord and Managing Agent – essential benefits
Forward-thinking landlords increasingly view a managing agent’s HMO service as a partnership which bring essential benefits that can be relied upon to:
- Maximise property investment and double rental yields.
- Guarantee rental income for five years (if via a leasing scheme).
- Eliminate rental “void” periods with rooms always rented.
- Protect, maintain and fully manage a HMO property 24/7 to the required standards.
- Comply with all necessary and legal requirements, and safety procedures, according to The Licensing of Houses in Multiple Occupation (England) Order 2018.
- Adhere to all mandatory licensing criteria, according to Management Regulations and Inspections under the Housing Health and Safety Rating System (HHSRS)
- Operate complete tenancy management and communication process from initial enquiry to end of tenancy, including, tenant screening and referencing, deposit scheme, contract, inventories, check ins/check outs, regular inspections and rental reviews.
- Provide complete account management with full visibility and control to landlords at all times.
- Run strategic marketing and advertising.
Why more HMO landlords rely on HMO Management
Since the 1990s, increased overcrowding (compared to the ‘bedroom standard’) has spread to an estimated 8 per cent of London households. Overcrowding rates are entirely found in the private rental sector (and social housing). (Survey of English Housing and English Housing Survey – 3 year period ending 2012/13).
England
- 5 million private rental households.
- 508,000 properties are HMOs.
Department for Communities and Local Government, English Housing Survey 2015-16
London boroughs
- 2,568,815 private rental households.
- 195,230 properties (7.6 per cent) are HMOs.
Department for Communities and Local Government, Local Authority Housing Statistics, 2014
Redbridge Borough
- 23,500 privately rented homes. Census 2011
- 2,600 advertised private rental accommodation. HomeCo Internet Property Ltd, 2018
- 133 properties are HMOs. Freedom of Information Act, Aug 2017.
If you are a property buyer or landlord seeking to build a HMO investment portfolio, or already own a number of large HMOs, Charlesons are the complete HMO Management and Licensing service with over 10 years experience in Redbridge Borough.
For a FREE Valuation, please call our dedicated HMO team today on 020 8550 2221
Alternatively, you can send us an email using the form below or use our Online Live Chat service by clicking on the button located at the bottom of your screen.
