5 Reasons to Invest in HMO Property in 2020

In this complete and ultimate guide to HMO property, we give you the principles on of HMO property from A to Z.

Renting out a House in Multiple Occupation (HMO) was always a great opportunity when it comes to the rental market. However, in the new year, there are new opportunities to vary the ways of property incomes.

Here are 5 good reasons to invest in HMO in 2020:

1. Income Increase.

All you need is a calculator to understand that this is a great way of gaining a higher income. One house can be rented for a standard market price (for example let’s say £1000 a month for a four-bed house), this is the price that is to be paid to you by all of your tenants living in the property. Alternatively, you could make up to three times the income by splitting the house into an HMO with four rooms. In the example given, even if you halved the rent for the house and charged that to three separate people, you’d be still be making £500 a month, and it’s still more than the conventional rent price.

2. Void Periods Affect You Less.

If you split your income among your tenants, as soon as someone leaves it doesn’t end up with you being completely out of pocket, as there will still be people renting your house. Of course, there will be a loss of income, however, this will be easier to handle. Also, don’t forget that tenant referencing works perfectly in such situations.

HMO Investment Companies


3. Avoiding Rent Arrears.

Investing in HMO you will less likely face the rent arrears. No one wants to have this, but if someone behind on payments is a smaller part of your income (because that person is just one of many in the HMO), it can be much easier to deal with.

4. Taxes Are Easier to Pay.

Taxes are easier to pay when rental properties are registered as  HMOs. Whenever talking about tax-deductible costs, it’s worth remembering that it can be a complicated issue and each case is unique. There are some HMO tax benefits that are clear. Such as deciding to change the property by adding an extension after you have bought a property for HMO property rental, these improvements can be classed as a ‘revenue cost’.

5. It Upgrades Your Property Portfolio.

A very useful feature of renting via an HMO property rather than a traditional rental. You will have a better grasp of your income, any work needing doing to a property will be easier to notice and then get done, and you can better manage your free time and your energy into being a better landlord to a smaller group of properties.


More to explorer