Thinking about buying to let?

With the UK’s population expanding at an ever increasing rate (it’s anticipated that there will be over 70 Million of us by 2035) it’s always going to be difficult for property developers to keep up with demand. Bow estate agent, Peach Properties says “The buy to rent market is currently at an all-time high, and one of the most popular ways to make money out of property is by building your own HMO (houses of multiple occupation) portfolio. “

All sorts of buildings work as HMOs- a spacious three bed semi can be converted into a home of double the occupancy, converted warehouses make excellent groups of flats and old government buildings are becoming increasingly popular with creative developers.  But where do you start? Here are a few top tips from UK property experts about how to build a successful portfolio of your own:

Find your tenants– Any home that is rented to 3 or more people or two plus families is referred to as an HMO. Building a successful portfolio of properties is pointless if there’s nobody to move in to them, so securing the right kind of tenants is essential. M&M Property explains how- “Use your networks and social media to reach out to potential renters, or advertise in classifieds. Even shop windows and supermarket notice boards are still a good way to advertise your property, and if you’re in a University town place an ad in the newsletter. Use a good credit checking and referencing agency to keep your investment and your property safe.”

Pursuing– Finding the perfect property takes determination, legwork and resourcefulness. Join local business networks and always be on the lookout for new opportunities. Never give up and never stop searching.

Presentation– Very few people want to move into a run down, unattractive property. One of the most enjoyable parts of building an HMO portfolio is watching the transformation of a building into a well-presented home. As any estate agent will tell you, first appearances matter- so refurbish and decorate your HMO to a professional looking standard from the outside in.

Payment– Great ideas are worthless without the money to make them a reality, so be clear about how you are going to finance your portfolio. There are lots of different strategies you can use to gain an impressive ROI, so do your research and make sure you’ve got a good financial and legal team behind you to keep all the numbers crunched.

Planning – Very few entrepreneurs make it big without a plan.  Think carefully about what you want to achieve, seek the right legal advice to future proof your investment and undertake a thorough risk assessment before committing. Also bear in mind the fact that you may have to seek planning permission to develop the property, so familiarise yourself with planning regulations and get to know the key people at your local authority.

As Robert Holmes concludes. “There’s big money to be made in HMOs and that’s not looking like it’s going to change anytime soon. Doing your research, building your network and keeping your eye out for great opportunities will go a long way in helping you build an impressive portfolio of your own.”

 

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