So what are the secrets of creating a high yielding HMO portfolio?

By in Blog with 0 Comments

Tips on building a profitable HMO portfolio

At Move we manage many HMOs throughout Gloucestershire and regularly take over neglected portfolios. Three months ago month we took over 24 HMOs for one landlord, within two months we have DOUBLED the yield of the properties with a few simple changes. He is now achieving an 18% yield across his portfolio.

  1. Buy the right property: Look for at least five rooms – ideally 6 plus. Profits grow experientially with this number of rooms.
  2. Location, Location, Location: It’s vital that you buy in the correct location, not just the town or city, this is even down to selecting the right road. When we source HMOs for clients we only buy in certain areas, it’s the keys to minimising voids.
  3. Look for a high density of young professionals and students in town/city centres with good transport links.
  4. Don’t over or underspend: Ensure you keep to a budget when you are refurbing and make sure your accommodation is scoped specifically with the local market conditions and demands in mind.
  5. Know your market: Match your development to the local market profile and conditions. Make sure you have done thorough research and have local expertise on your side. At Move we are always happy to help and advise and regularly look at properties on behalf of clients.
  6. Abide by the law: Ensure you understand the various regulation and legislative requirements and you uphold them.
  7. Use reputable trades people: Your refurbishment will go much more smoothly and you will meet your deadlines if you use professional builders etc. A stitch in time saves nine in line, you do not want to be returning to the property to complete basic maintenance post refurbishment.
  8. Future proofing the portfolio in the build – Although they can be significantly more expensive, use materials and suppliers with the highest durability, warrantee, and correct function for the task. It’s also worth buying good quality furniture, not only will it last but it will also attract a better quality of tenant.
  9. Maintenance costs: Minimise them were you can. For example, high durability carpets, lifetime warranty on door handles, strategic selection in bathroom finishes, kitchen specification and even light bulbs.
  10. Reversion costs –Be cautious of developing too much of a purpose-built scheme that has a significant reversion cost, should the market conditions change and core function of operation for the property shift.
Share This
George Tatham-Losh

Since forming the business in 2009, our founder, George Tatham-Losh, has become highly regarded as the local go to expert for advice on maximising property values and getting the most out of property investments, regularly speaking at events and holding well attended seminars. Born and raised in Cheltenham, George knows the town and County like no other and knows what works in the area. Alongside George is a specialist team of agents with a wealth of experience to help you sell, buy, let or rent property in Gloucestershire.

Blog Post Disclaimer

This is a personal blog. Any views or opinions represented in this blog are personal and belong solely to the blog owner and do not represent those of people, institutions or organizations that the owner may or may not be associated with in professional or personal capacity, unless explicitly stated. Any views or opinions are not intended to malign any religion, ethnic group, club, organization, company, or individual.

All content provided on this blog is for informational purposes only. The owner of this blog makes no representations as to the accuracy or completeness of any information on this site or found by following any link on this site. The owner will not be liable for any errors or omissions in this information nor for the availability of this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information.

Downloadable Files and Images Any downloadable file, including but not limited to pdfs, docs, jpegs, pngs, is provided at the user’s own risk. The owner will not be liable for any losses, injuries, or damages resulting from a corrupted or damaged file.

Comments Comments are welcome. However, the blog owner reserves the right to edit or delete any comments submitted to this blog without notice due to :

  • Comments deemed to be spam or questionable spam.
  • Comments including profanity.
  • Comments containing language or concepts that could be deemed offensive.
  • Comments containing hate speech, credible threats, or direct attacks on an individual or group.

The blog owner is not responsible for the content in comments.

This blog disclaimer is subject to change at anytime.

If in considering action upon the contents of this blog, one should always seek professional advice.

We Won Banner We Won Banner