HMO properties have higher yields, but are more complicated to set up. HMO licenses are required depending on the nature of HMO properties.
A traditional buy to rent model would typically house a household or even a group of people who have made the decision to live together. Disputes are resolved in the home without having to go to the landlord. This is why landlords usually have an HMO type. It could be student buy to let, or an HMO for professionals only.
Naturally, higher potential rewards are associated with higher risk. A traditional buy to let will have a higher turnover, but you're also more likely than a traditional buy to let to have tenants that leave. Each additional tenant is an unknown variable (e.g. What will their rent be? Do they cause any damage? Are they likely to cause problems? Also, you will need a specialist mortgage.
Traditional rental properties don't have to be located in a particular area. The country's leading letting agents have rented property in virtually every location. They can be rented in any location: rural, urban, or country.
Complex property types are more risky than others. Lenders that don't want to lend to them will not be willing to do so. Those who do will have to meet their individual criteria.
HMOs often come furnished. This is another cost to be aware of. Traditional buy to rent properties are usually unfurnished.
It is crucial to do the numbers crunching in order to make an HMO profitable. Our HMO mortgage experts can help you maximize your rental income through a thorough analysis of your proposal. A great deal is key to making your HMO more profitable. Many lenders offer preferential rates through mortgage brokers.