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Hi, I'm a new member and looking for advise on my first investment in a HMO property. I have just come back from overseas and have roughly 250k in savings that I want to invest in this type of Property asap.
I'm looking for advice or a point in the right direction towards trusted property sourcing agents/members on here that have experience in this. I'm flexible as to where in the country the property is I just want help/advise in finding the best location having been out country for so long.
many thanks in advance, looking forward to using PT regularly going forward as looks a great source of info!
Hi Paul and welcome to the tribe.Do you have any experience of being a landlord with renting out properties as whole dwellings?
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
Hi Vanessa, thank you!
not in this country no, only in NZ which was not HMO and just a standard BTL. I am looking to invest here and create a large enough passive income to allow myself to do this full time.Hence high yield HMO seeming the most appealing.
I understand it takes quite a bit of work but would most likely give the managing of the property over to a regional agent unless it was close to where I live (Newcastle).
Thanks for clarification Paul.There are very few agents who will take an HMO on due the the intensive management, enhanced regulation, and higher tenant turnover. They just don't want the hassle!If you must get involved in HMOs, I would be minded to find the agent first, and then find a suitable property in their area. They may even know of a landlord selling up.I am not a fan of inexperienced landlords getting involved in HMOs, and involving a deal sourcer and an agent will reduce your profit margin, so HMOs might not be a good a strategy as you initially think. Of course, it will all depend on the numbers .... and you MUST research these yourself, not rely on what a third party tells you.Finding the agent first will reduce your risk imho, and finding a tenanted HMO would reduce that risk further. It might be worth having a look on the Vesta platform for a suitable property. Click "Buy" >>> Browse properties >>> and select "Above average yield" .... and it brings up quite a few tenanted HMOs.Hope that helps?
Thanks Vanessa, really appreciate the advice.
the Vesta platform looks great, are there any similar sites that you would recommend as a starting point?
very much appreciated
Hi Paul,Not sure I understand what you mean? What other starting point are you interested in?
As I mentioned if the right property would be in North East of country id be hands on and fully manage. However if better opportunity arose elsewhere in country I would happily pay to have it managed.
only one comment - a strong local agent!
We have a couple - just come back from a weekend painting 3 bedrooms! 3 hour drive each way
My local Agent is great, husband is a carpet fitter and knows all the trades (so had 2 x decorators on Saturday to get the job done on a great day rate) but without local knowledge - don't bother!
Our BTL's look after themselves but return isnt as good obviously.....
My UK house is in Wensleydale and I'm selling it because my tenant has just left and I'm not really happy with the rental income on it (£1050 per month on a house currently on the market at £300k, the value not having gone up since 2008). I thought of turning it into an HMO because it's a huge house and there is a demand in the area. I've also considered setting it up as a large holiday let (it's a popular walking holiday area). My problem is as Vanessa highlighted - finding someone to manage it. The agents in the town don't do HMO management and I'm really not sure where to look. Someone asked me if they could rent it to run it as serviced accommodation but I know nothing about that and that makes me wary - I also don't think my bank would be happy with that. I've been looking at already set up HMOs in case mine sells (just put it on the market) and I notice there are a lot on the market at the moment. Just look on rightmove at Aberystwyth, for instance. I think you need to be careful because there must be a reason a lot of them are being sold. Changes in the law or licensing requirements perhaps?
The houses in Aberystwyth do not sell for not much and do not rent for much and the cheap price attracted too many hence the off loading of loads. Long term bet? I doubt it.
The Uni is really the only source of business in the town which is crammed full of ex students with very poor job prospects.
Cardiff is very different , more expensive