Portfolio Building Professional HMO Services versus Ready Made Professional HMO

Portfolio Building Professional HMO Services versus Ready Made Professional HMO

I had a call yesterday inquiring the advantages of buying a ready made, tenanted buy to let or Professional HMO versus a service offered by builders or estate agents with a portfolio building professional HMO or Buy to let. I thought it was a very good question yet very clear to me.

The portfolio Building Professional HMO Service seemed great on the quick service of it all. Just pay, a sourcing fee…just pay a management fee to run the project…just pay fee to have the property tenanted….that is it and just collect your way to riches. I told the women on the surface of it all, it sounds great..however adding up all these fees, it gets rather expensive & what do you do if the portfolio building servicer does not perform? What do you do if you have a half or quarter finished buy to let or Professional HMO?

I told her first hand of all the issues we run into. There are always issues that must be dealt with at times immediately. There are always unexpected expenses. I told her about a women from China who tried to have sourced a HMO, refurbished and tenanted all from China. It was a nightmare. More so, anyone can promise anything. There are alot of moving parts when refurbishing  & tenanting. It all depends on the quality of the people she would be working with.

I compared it to having someone bake you a cake. You need the right ingredients, they need to know how to bake a cake and they will watch the cake in the oven. The cake might not ever get cooked or maybe burned in the oven. The contrary is simply buying the cake all ready. One can choose as they see fit.

I have read alot of facebook posts and have read many nightmares both with sourcing….both with mentors who disappear and even nightmares with JV partners. You need to know you are working with in property and even with that you can get surprised. I built for 10 years with a gent. We were building 9 houses at a time.  More than 25 houses a year on average. We were making great money. However my builder buddy got builderitis. A disease only known to builders. He got greedy and started using materials on “our” my houses for houses he started building on the side.

I shared that story…Trying to project manage and tenant from a distance is a tough one without the right team. I work with local gents who grew up in Manchester. They know which streets and parts of those streets are good and bad. They make a great deal of money all based on their efforts. They have a very big incentive to run the commercial to residential projects and professional HMOs timely and profitably both for themselves and us. There is a very big difference than someone simply charging a fee to source or project manage. They might be wonderful however they also might get busy. I have heard the phrase too many times…Leave it with me and it is just that…Left…