Better returns with HMO buy-to-let
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%.
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