HMOs do not always generate the same rental income as buy-to-let properties. Remember that utilities bills are often paid by landlords. With the above example, even with an annual PS2k-3k utility bill, there's still a lot of rental profit.
HMO lenders are going to be looking at the knock-on effect of higher risks on your ability and ability to pay the mortgage.
A House in Multiple Occupation or HMO is a property which is rented to three or more tenants. The unrelated tenants can share facilities like a bathroom or kitchen. HMO lets landlords rent the property to multiple households rather than just one.
HMOs may be more difficult than traditional buy-to let models. HMOs have facilities that are shared between tenants. Tenants may sometimes become disenfranchised. Sometimes, tenants may not see eye to eye and you could be called upon as a mediator.
HMOs may not generate three times as much rental income as a buy-to-let standard. You should also remember that landlords usually pay utility bills. However, even though the utility bill is approximately PS2k-3k annually, there is still a significant rental profit.
HMOs are not valued by all lenders based only on rental income. Lenders will instead value the HMO as a standard house. This can limit your ability to borrow money, which can defeat the purpose behind an HMO mortgage.
A large HMO, also known as a HMO, is a rental home with more than five tenants. In this case, the tenants share a common toilet, bathroom and kitchen. There might be a limit to the number of stories within a building. Landlords require a HMO license to operate a large HMO. This licence will be valid five years.