Individual tenants love HMOs because they are affordable and fully furnished with all bills. This is especially true for international students, contractors and employees on work visas. HMOs are attractive because they allow you to'move straight in' at a very low cost.
A House in Multiple Occupation (HMO), is a property rented to more than one tenant. They may share facilities, such as a bathroom and kitchen. HMOs allow landlords to rent out a property to more than one household.
Only a handful of UK specialist lenders are willing to lend large HMO properties and are familiar with the lucrative yields associated with multiple tenants. They define HMOs differently and will lend against different properties. That is why it is important to have a broker help you to create your application and match the right broker. CMB, an experienced broker, can package your request to meet the lender with the best terms. This greatly speeds up the application process.
As nobody wants to take another person's mess, common areas tend to 'get left. Sometimes, landlords will need to clean the property or hire cleaners.
HMO landlords often pay the utility bills of the property unless it has been converted into flats with separate title deeds from the land registry.
HMOs can be restricted to certain areas. HMOs can be targeted at specific tenants such students and single professionals. HMOs are often located in central areas or near major bus routes and amenities. It would be pointless to have an HMO located in a rural area in the middle-of-nowhere.
A traditional property to buy and let would normally accommodate one person or a whole family. Renters would pay a single rent payment, either weekly or monthly. The household would also be responsible for paying the utility bills. These are sometimes referred to as "singlelets".