Better returns with HMO buy-to-let

September 1, 2015

When it comes to calculating the return on a BTL investment, the HMO buy-to-let far outweighs that of the standard buy-to-let,  analysis from Platinum Property Partners suggests that even if the interest rate were to increase by 3% a HMO investment would still be profitable.

Steve Bolton, Chairman of Platinum Property Partners, reportedly  said: “Not all BTL is equal, and our data shows that HMOs generate much higher rental income than standard BTL properties. HMOs will therefore be an attractive option for investors looking for a lower risk strategy that achieves a strong level of income.

“With many changes on the horizon for landlords, including the proposed restrictions to mortgage tax relief and looming interest rate rises, it’s never been more crucial to have a decent cushion of rental income to absorb any rising costs”.

According to recent reports typical  HMO landlords purchase properties worth £245,486 with a £170,310 mortgage with a rate of 5.17%, while standard landlords purchase homes worth £183,391 with a £138,594 mortgage at 4.00%.

Allen Walkey

Highly experienced businessman with a successful career in property sales and investment both in the UK and abroad. Now a freelance writer and blogger for the property and Investment Industry, keeping readers up-to-date with changes and events in a rapidly changing world.

You May Also Enjoy

Letting Agent Talk

The pros and cons of renting to students: is it the right choice for you?

Student properties are no different in term of quality and facilities than any other type of private rental. And although landlords may have to spend a fair amount on setting up and properly maintaining student lets, they can also charge a good market rent. To help you decide whether letting to students might be worthwhile…
Read More →
Finance

Autumn Budget Misses Mark on Housing Reform: UK Rental Market Squeezed by Shortages and Rising Rents

The UK rental market faces mounting pressures, with a recent Rics survey revealing a critical shortage of properties and surging rent prices. Landlord instructions, a key indicator of properties available to rent, fell to a net balance of -29%, marking this the lowest level since 2021. Strong tenant demand is driving rents higher, with 33%…
Read More →
Estate Agent Talk

Save a house deposit faster than ever in THESE areas!

Save a house deposit faster than ever in THESE areas! Aberdeen City in Scotland is named the best place to live if you want to save for a house deposit fast, saving in as little as a year and a half Inverclyde is second, whilst Burnley is third Average salaries and house prices in each…
Read More →
Estate Agent Talk

Finding Your Dream Home: Expert Advice from Camberley’s Top Estate Agents

Finding the right estate agent is crucial when navigating the competitive housing market in Camberley. With local expertise and in-depth market knowledge, these professionals can guide you toward your ideal property, saving you time and effort. Their understanding of the area’s nuances, from property trends to community relationships, positions them as indispensable allies in your…
Read More →
Breaking News

Zoopla reveals most affordable towns in Britain

With the average home valued at nearly four times average household incomes, Zoopla reveals the most affordable towns in Britain   An average property in Britain is valued at 3.8 times the average annual household income (assuming 2 full-time workers) Cumnock in Scotland, is Britain’s most affordable town to buy in 2024 with average property…
Read More →
Software & Tech

The Evolving Nature of Real Estate and Strategies for Agency Success

Real estate agents are used to working with fluid market dynamics. Adapting their sales strategies and responding to new industry demands is almost second nature to most agencies today. However, while making the necessary adjustments when following housing market trends is important, it’s also important for agencies to consider new business innovations that become available…
Read More →