Have you been considering investing in a HMO property? It is true that an HMO can be very profitable in terms of income. However, with that extra income comes extra work. So, in this blog post we help you understand is HMOs are a good investment opportunity for landlords in Peterborough.
It’s important to note that here at AGT Property Management and Lettings, we can manage the maintenance and lettings of your HMO property. This means that it isn’t too much extra work and stress for you, as we can take the property stress and worries out of your hands.
Are HMOs A Good Investment For Peterborough Landlords?
An HMO can be a good investment for landlords in Peterborough. The main goal of your property investment is to get as much rental income as possible, then HMO property investment could be for you. By letting the property to multiple tenants, on a room-by-room basis, you can gain two or event three times the rental income you can expect from renting a standard family home, for example.
However, while it good to think about the profit and rental income, there are other things to consider too. For example, it is likely that your expenditure will be higher. This is because of the possible extra wear and tear caused by having more tenants. You may also find that your mortgage costs are higher. In addition to this, there will be additional health and safety requirements for an HMO property. This means that the extra rental income you are gaining, might not always be extra profit.
You may also find that there is a trade-off between rental income and capital growth. This is because in areas where HMO properties are allowed, they may not always increase in value as much as a single-let property. As we have touched on, there will be extra work too. Instead of dealing with one tenant agreement and a set start and end date of the tenancy, it will be multiple agreements, tenants and dates of moving in and out. It will be like managing many tenants in individual properties, instead of one single-let property.
It is worth noting that the tenants in the HMO may not know each other, but they will be living together with the same communal areas. If you don’t work with a HMO management company, like our team, then you could find yourself spending a lot of time encouraging tenants to live harmoniously with each other.
Considering becoming a Peterborough HMO landlord? Call our team now to see how we can support you in this rented property journey.
