More landlords seeking to add high yielding HMOs to their portfolio ahead of Brexit?

Following on from our post last week looking at areas in Manchester suitable for HMO investments, new evidence points out the number of landlords looking to expand their property portfolios to include house shares.

With yet more Brexit uncertainty and the potential impact it may have on the property market, an increasing number of buy-to-let landlords are looking to add HMO properties to their portfolios due to the often higher achievable yields.

In a report by Precise Mortgages, it has been uncovered that just over one fifth of buy-to-let landlords in the UK (21%) are in considerations to purchase a HMO. In the same research contributing to the report, only 8% of landlords are planning to off-load their HMO properties in preparation for Brexit.

HMOs have continued to grow in popularity by tenants due to their hassle free, modern living that appeals to students and working professionals. When done to outstanding specifications and design, the results and returns speak for themselves

In fact figures by Precise Mortgages reveal that the greatest average rental yields in Q2 at 6.3%, compared to the market average of 5.5%, could be found in HMO properties.

Alan Cleary, managing director at Precise Mortgages, said: “In a time of market uncertainty, HMO are an attractive option for professional landlords looking to maximise yields.

“As HMOs attract multiple tenancies, gross rental income tends to outstrip single lets meaning the rental income is more secure if one tenant leaves a void.

“The expansion of the HMO sector underlines how experienced landlords are re-balancing their portfolios.

“It also demonstrates the opportunity for brokers to work with specialist lenders who have expertise across the widest product set to support clients who are reassessing their portfolios.”

Over the past year, Abode has seen an substantial increase in landlords utilising the popularity for HMO in the surrounding areas of Manchester, with over 100 new rooms being taken on under full management.

In order to succeed with HMO properties, ensuring the correct location and design conducted throughout is critical. Tailoring the properties for modern students and working professionals is key to minimising the void periods; benefiting from the high yields these properties lend themselves to.

If you’d like more information on the full management of your HMO in order to gain the best results for your yields, give us a call on 0161 883 2525


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