How to Find HMO Properties to Buy

The first step to becoming a successful HMO landlord is being able to find the right properties for you. You need to understand exactly how you want to build your portfolio, and the kind of properties that are going to help you do this. 

Now, start by envisioning both short-term and long-term goals you have for the business - do you want to invest into social housing, student accommodation or for working professionals? The difference in these types of tenants will result in you needing to cater for very different needs. For example, students will likely have much less experience living independently, so you will need to be prepared to respond to a variety of queries and needs. It is important to know your intentions right off the bat, and it doesn't mean that this can't change further down the line, it just gives you a solid place to start and a good direction to go in.

Another important aspect when choosing a HMO is the location. Choosing a property in a desirable and sought-after location will ensure a high demand of tenants and much higher potential for long-term capital growth. The best thing you can do, when looking at a particular location, is learn everything you possibly can about the area; are there good local transport options, good amenities available (such as medical care and grocery shops), how competitive the area is and are there aspects of the area which will soon be improved and therefore add further value? All of these things come into play when choosing a good location for your HMO, and it doesn't mean they have to be the best in all of these categories, but ticking as many boxes as possible is very important.

Lastly, a big thing to consider is the size of the HMO you will be wanting to rent. It may seem as though the bigger options are better, with more rooms to rent and therefore more rental profit, however there are always many other things to consider. For example, a HMO with more than 4 bedrooms will then need an additional bathroom (or two), which will then require more space and investment into the refurbishment. You also want to avoid compromising room size for the sake of room quantity, as having smaller cramped rooms is likely to deter potential tenants. Additionally, the size of the property will also determine whether or not planning permission is needed, as this could be something which makes the process more drawn out and could make it a longer wait before the property is tenanted and profit is coming in. 

Overall, there are many details to consider when choosing the right HMO properties, and the cities you are buying in will have even more factors such as population, educational facilities and Article 4 restrictions (which I have covered in a separate post which can be found here: https://www.luiginewton.com/blog/hmos-in-nottingham-article-4-direction). However, the most important thing you can do is learn as much as possible about the area, the building itself, and what you want to gain from it, and the rest will come with time and experience.