hmo finance 4.0
Landlords may manage their HMO property using a single "joint & severally liable" agreement or one for each tenant.
It is crucial that you get the best possible deal on your financing to ensure a long-term return. Get in touch with our HMO mortgage finance specialists.
HMOs are an investment opportunity. HMOs offer fewer "impactful empty spaces": The gap between tenants of a single-occupancy property can be no more than one month. This allows for repairs and redecorating as well as viewings. Rent does not come in. You can reduce your losses by having an HMO where the rent is paid by the remaining tenants. A higher percentage of your expenses may be exempted from tax than a standard BTL.
Landlords may manage their HMO property using a single "joint & severally liable" agreement or one for each tenant.
HMOs often come furnished. This is another cost to be aware of. Traditional buy to rent properties are usually unfurnished.
HMOs need a license from the local council where the property is located. This licence must be valid for five year. It is important to check with the local authority about the area's policy. Although five-person properties are the most common, smaller properties that have fewer tenants may also need a license. It varies depending on where you live so it is important to get all information before applying.
Many HMOs can be furnished fully. This adds an additional cost. Traditional buy-to-let properties are often rented unfurnished.
What is an HMO? A house in multiple occupancy (HMO) refers to a property that has shared facilities like bathrooms and kitchens. It is usually rented out to three or four people, but not as a "household". A licence is not required to operate a standard HMO that has four or fewer tenants. However, HMOs have different requirements than buy-to-let mortgages that are used for whole-property rentals.