Everything is a Balance with Professional HMOs

Everything is a Balance with Professional HMOs

Myself and my JV partners are always learning. One of the main issues is that everything is a balance with Professional HMOs. On one level it is very easy to say I want to have larger Professional HMOs. Finance is commercial, however most banks want to cross collatarize all of your portfolio. This means if you struggle with one property, the whole portfolio could be in danger if you do not have enough liquidity. Management of large HMOs also might be more intense and complicated. More so one needs a bigger pot of money to invest in the HMO. Clearly if over 5 people and 3 stories, then a license is needed. However, it is very obvious all HMOs will be licensed and inspected by the council in the upcoming year. One can even balance the finish of the HMO. They might go the rudimentary basic….magnolia walls and cheap used furniture…or the property investor can enhance the property and make it almost like a mini luxury hotel. You just need to know your market and your competition for your professional HMO. One thing is certain….you will almost pay the same bills with a 4 bed as a 5 bed. Same council tax…almost the same utilities…same internet…etc…However we have seen some tenants prefer to live with less people in their Professional HMO

Bottom line is have a plan…realize there are always trade offs and stay within your budget.