HMO licences can have additional conditions depending on the council. HMO licences may only be requested by local authorities. Without a license, the penalty for renting a licensable HMO is up to PS20,000.
HMOs are often restricted to specific areas. HMOs, for example, are designed to target certain tenants such as single professionals or students. An HMO's location is often restricted to central locations, or areas with easy access to bus routes and other amenities. It would be absurd to have an HMO in a remote location in the middle or even in the middle of nowhere.
HMOs may not be valued equally by lenders. Some will base their valuation on rental income, while others will base it on the HMO being a regular home. This can reduce the amount you are able to borrow, which defeats why an HMO mortgage is needed.
Lenders might take into consideration the potential rental income when assessing your HMO's worth. This is especially important if the property has been converted and you want to withdraw some equity.
HMOs with no license may not qualify for an HMO mortgage. Lenders may instead consider a buy-to Ð let mortgage.
HMOs may be restricted to a specific area. HMOs target specific tenants, such students or single professionals. HMOs are typically located in urban centers or other areas that have easy access to public transport and other amenities. It would be unwise to locate an HMO somewhere in the middle if it was in a rural setting.
HMO landlords will often pay utility bills if the property isn't converted to flats and has separate title deeds.