We can show you how to have capital market growth and HMO cashflow in the same property!
One of the best ways to achieve Money In Money Out (MIMO) on your HMO project is to add more bedrooms or units (otherwise known as a suis generis HMO). While this is great news for your original valuation, this could over time lead to lower future valuations. Here’s why…
This will give you access to bricks and mortar valuations (in many areas these can be 20% higher than a block or suis generis valuation).
You will be able to choose a commercial valuation or bricks and mortar valuation (split value), dependent on what works best for you.
You can sell to individual retail buyers or an investor in time…your choice.
HMOs continue to be highly sought after, especially in areas where demand is robust. Converting Title Split blocks of 2-bed flats into individually rented HMO rooms is a particularly attractive strategy, catering to renters who prefer the simplicity of not handling bills themselves.
Certainly, any strategy that increases the number of bedrooms tends to enhance a property’s value. Converting a single property into an HMO, thereby maximizing the number of rentable rooms, is a proven way to boost its overall value.
Converting a property into an HMO often entails a comprehensive refurbishment, covering aspects such as rewiring, insulation, fire regulation upgrades, structural work, new kitchens and bathrooms, and high-quality decoration. These investments are crucial for compliance and tenant satisfaction.
Generally, no planning permission is required for small HMOs with up to 6 people. However, larger HMOs (7 or more occupants) may necessitate planning permission. It’s important to check for article 4 directions in the area, as planning might be required for 3 unrelated sharers.
Yes, in some instances, planning permission might not be granted, depending on local regulations and property characteristics.
The prevalence of HMOs in a property portfolio varies based on investor preferences. Some investors find the higher potential profits attractive, while others may prefer a mix of property types for diversification.
HMOs can yield higher profits compared to single let properties, but it’s crucial to factor in all associated costs. Consider elements like bills, repairs, and agent fees, especially if landlords cover utility costs.
The increased number of rentable bedrooms in an HMO often translates to higher rental income. Charging rent per room can result in a more lucrative venture, though careful consideration of operating costs is essential. Some investors prefer Title Splitting apartments and renting to individual tenants who handle their own bills for added simplicity.
We are very proud to be Continuing Professional Development (CPD) members. Get more info about CPD at Title Split.
Title Split Limited | Company Number: 12813014