HMOs are a good investment. - You can expect to make roughly twice the rent if you have a higher rental income. A four-bedroom house rented to one family can be rented for PS800 per monthly, while four tenants pay PS400 each. To attract tenants, you might charge a rent plus all bills. Your costs will be much higher.
In assessing the HMO's value, lenders might consider your rental income. This is especially useful if you are trying to withdraw equity or have converted the property.
HMOs are a good investment. HMOs have fewer "impactful vacants". The difference between tenants in a single occupancy home can be less than a month. This allows for viewings, repairs and redecorating while no rent is coming in. Your losses are reduced by an HMO, which allows the tenants to pay rent. Tax-deductible costs are possible to a greater extent than standard BTL.
HMOs will not all generate triple the rental income of a regular buy to let. It is also important to remember that utilities bills are typically paid out by landlords. The above example shows that even with a PS2k-3k monthly utility bill, rental profits are still substantial.
You should also consider void periods. An HMO has more void periods than a traditional buy-to-let. HMOs may have higher maintenance costs than traditional buy-to-let models. This is due to shared communal areas like bathrooms, kitchens, and living rooms (where appropriate).
As you don't know the criteria of every lender, it is not a wise idea to approach lenders in your quest for a mortgage. A specialist can ensure that the right lenders are approached and that you receive the best rates. For assistance with mortgage queries, contact us immediately or make an inquiry at any moment.
HMO Finance rates? The lender and their willingness to consider your unique circumstances will dictate the interest rate that you will be charged.