Changing residential to HMO - Floor plans included

[JCKST1]

Evening everyone,


There is a property close to my self currently on the market I am interested in as a BTL.

Its a three bed house in need of modernising but in a reasonable area on the edge of a town, within 5 mins walk you have the towns bus depot with links throughout the north east and a 10 min walk will take you to the train station again with direct links to Newcastle, York, Darlington etc. Its also close to a uni however their needs a quite well catered by the uni campus as far as I know.

Once modernised the property would bring in about £475 per month however having had a look at the plans it looks like it would work well as three separate apartments which once complete and in a done to a good standard should get £275 per month absolute minimum, probably even £300+ to be honest.

I am not new to BTL or 'flipping' properties but never looked or considered the HMO route before. I will read up on the legalities properly before doing anything but looking at the below plans do you think this could work and be beneficial?

The 'kitchen' I refer to would just be 3-4 floor units with basic appliances and a couple of wall units for storage.
WC in the rooms would be toilet, sink and shower and finally the lounge part would be big enough for a sofa, coffee table, TV stand etc.

My target market would probably be a young professional or couple who want a cheap base for work or similar. Either way I think they would rent easily, there is a few other small HMO studio apartments for rent within the town but there typical HMO (old and very sad looking!).

Anyway below is the floorplan (top image) and below a very rough drawing on what I had in mind.

Any advice is appreciated on this. I know there is various things you have to cover with a HMO so bare with me while I look in to this but I am just weighing up my options on if I should proceed with the house as a normal BTL or do the above.

[Mortgage_tom]

I’m not sure what the HMO regulations are in your area. But that is a multi unit block your proposing, not a HMO. A MUB it going to be treated differently to HMOs when it comes to a mortgage. Some of the traditional HMO lenders won’t touch it in that configuration, multiple kitchens. Still a few that will though, but rates will be on a par with those that lend to LTD companies. Not an issue if LTD company ownership was the route you were going to take anyway.

You should also check what local authority restrictions are in place for a change of use from single dwelling. That might be restricted in your local area or zone.

I’m a HMO landlord myself, if you drop me a message, I’ll email you a useful spreadsheet I’ve got for cashflow projection.

[Piersman2]

Where are the occupants supposed to bathe? The WCs look awfully small for a bath/shower.

[Storer]

It looks as though the stairs dissect the lower two floors with those occupants having to go into the stair area to get to parts of their flat.
I suspect if that is the case it is a non starter, in my opinion.

Issues with both security and privacy.

[dazwalsh]

Storer said:

It looks as though the stairs dissect the lower two floors with those occupants having to go into the stair area to get to parts of their flat.
I suspect if that is the case it is a non starter, in my opinion.

Issues with both security and privacy.

Yeah thats a bit of a deal breaker, having locks and fire doors on what should be internal doors is a bit rubbish, you will need to rejig that lower floor layout.