House in Multiple Occupancy
Discussion
Not sure if this is the correct forum, but here goes.
I've a large property in a decent location and currently deciding how to redevelop. Figures below are for illustration rather than comments needed on them!
Was going to develop into 4 apartments and a commercial unit on the ground floor (got a tenant for that already - chap with succesful business wants to expand). Redevelopment costs would be approx £100k and rental would be c£2,500/month.
I've just been thinking to perhaps convert into an HMO instead (still do the commercial unit as well). Probably 7-8 rooms could be let out, rental perhaps £2k/month, however substantially less redevelopment costs needed. Worst case scenario if it doesn't work out I can still convert to apartments.
Anyone had any experience of HMO's? Good or bad? Should I do it or apartments? Any tips or pointers?
I've a large property in a decent location and currently deciding how to redevelop. Figures below are for illustration rather than comments needed on them!
Was going to develop into 4 apartments and a commercial unit on the ground floor (got a tenant for that already - chap with succesful business wants to expand). Redevelopment costs would be approx £100k and rental would be c£2,500/month.
I've just been thinking to perhaps convert into an HMO instead (still do the commercial unit as well). Probably 7-8 rooms could be let out, rental perhaps £2k/month, however substantially less redevelopment costs needed. Worst case scenario if it doesn't work out I can still convert to apartments.
Anyone had any experience of HMO's? Good or bad? Should I do it or apartments? Any tips or pointers?
Only limited experience of HMOs - they can be very profitable but take a lot more administration and you stand a greater risk of tenants not paying rent or doing a moonlight.
If you are located in situ or very nearby, it can work but you have to be very hands-on or possibly employ someone to do it for you.
Also, the rules a Landlord has to abide by for ASTs are becoming pretty stringent these days but I'm pretty sure that those governing HMOs are considerably more complex and have a higher cost implication.
Would suggest you look into this in detail or take professional advice before taking the plunge.
HTH
If you are located in situ or very nearby, it can work but you have to be very hands-on or possibly employ someone to do it for you.
Also, the rules a Landlord has to abide by for ASTs are becoming pretty stringent these days but I'm pretty sure that those governing HMOs are considerably more complex and have a higher cost implication.
Would suggest you look into this in detail or take professional advice before taking the plunge.
HTH
BuzzLightyear said:
Only limited experience of HMOs - they can be very profitable but take a lot more administration and you stand a greater risk of tenants not paying rent or doing a moonlight.
If you are located in situ or very nearby, it can work but you have to be very hands-on or possibly employ someone to do it for you.
Also, the rules a Landlord has to abide by for ASTs are becoming pretty stringent these days but I'm pretty sure that those governing HMOs are considerably more complex and have a higher cost implication.
Would suggest you look into this in detail or take professional advice before taking the plunge.
HTH
+Agree new HMOs require local authority planning approval, very stringent Health, Safety and Fire regulations, with possible regulations that all bedrooms should have it’s own washing facilities, which on a purpose built property is possible, but try and install on an old Victorian converted property I have only just recently sold two HMO properties, simply due to the amount of work, stress in managing the two propertiesIf you are located in situ or very nearby, it can work but you have to be very hands-on or possibly employ someone to do it for you.
Also, the rules a Landlord has to abide by for ASTs are becoming pretty stringent these days but I'm pretty sure that those governing HMOs are considerably more complex and have a higher cost implication.
Would suggest you look into this in detail or take professional advice before taking the plunge.
HTH
On paper there is an attractive financial return on bedsits, but that is on paper, with most HMOs never fully let, mixed type of tenants, working, students, unemployed etc., so lot more movement of tenants, disputes between tenants, rental arrears, one, two tenants fall into rental arrears, it soon spreads to four, five etc.
In Bristol lots of investment money being put into self catering studio flats, with the rent including gas, electric, broadband, TV etc., tenants/students now expect more, and the older HMOs are started to be converted into studio/self contained flats.
Wings said:
+Agree new HMOs require local authority planning approval, very stringent Health, Safety and Fire regulations, with possible regulations that all bedrooms should have it’s own washing facilities, which on a purpose built property is possible, but try and install on an old Victorian converted property I have only just recently sold two HMO properties, simply due to the amount of work, stress in managing the two properties
Having worked in Local Authority building control, liaising with EHO's on HMO issues, I can tell you that the general attitude is very much against them and Authorities tend to do everything possible to make life difficult and apply the rules to the letter.Be particularly conscious of fire regs and the minimum room sizes stipulated in the Housing Acts - they'll have you for overcrowing quicker than you can blink, given half a chance.
Unfortunately, all HMO owners remain tarred with the Rachmanite brush.
Gassing Station | Homes, Gardens and DIY | Top of Page | What's New | My Stuff