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Housing, Investment

Why are HMOs attractive for property investors?

Many property investors are attracted to HMOs (Houses of Multiple Occupation). This is mainly driven by the potential for higher returns on their investment.

There are many reasons as to why the return can be higher. To being with, the total rent charged out to multiple tenants can be higher on a per week basis than renting a property to a single tenant.

There are also less likely to be significant rental voids. If a property is only rented to one tenant, who decide to leave, or not renew their tenancy, there might be a gap with no rental income coming in before a new tenant takes over. With HMOs, even if a tenant decides to leave, there are usually other tenants who are still paying rent.

HMOs are not always straight forward. You need permission and the correct licensing for a property to be an HMO. They can also require more hands on management.

If you want to know more about investing in HMOs and whether you might qualify for finance, you can speak to your local ASC director

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