Develop a HMO for Your Tenant Type
“Create an HMO that you’d live in yourself!”
This is the general, generic comment that we hear quite a lot from landlords, and is a great rule to live by, to develop and operate HMOs.
What landlords are saying
We often ask self-managing HMO landlords for advice once we have completed their sales.
One recent client gave us these three key points:
- Maintain the house to a standard that you would want it be to be if you were living in a room in shared house – as that decreases tenant turn and improves occupancy
- When refurbishing or developing the property, spend the money that buys away future maintenance – it works out cheaper and is less hassle even though it’s a little more expensive at the beginning.
- Location is everything – do your research before buying
We love the “buy away your maintenance” quote and have seen how this can keep HMOs more manageable and less costly to operate first-hand – notwithstanding the fact that they become nicer places for the tenants to live in for the long-term too.
In this instance, having seen the HMOs in question, the landlord reduced further maintenance, not just with good quality appliances, furniture and boilers etc, but with additions such as recessed coir matting in every entrance hall, floors tiles instead of carpets in heavy-use areas and shower board panels in the en-suites which are all designed to stand the test of time and the many occupiers that live there.
What the experts are saying
Wendy Whittaker-Large of Best Nest in Crewe shard the below advice with us;
“My top tip on running HMOs successfully is to understand the nature of the relationship between yourself and your tenant. Whether you are an agent, investor or landlord, you need to have boundaries and also flexibility in that relationship.”
“You neither want to become so indifferent that the tenant feels irrelevant and unimportant, nor become their personal heating, cleaning and maintenance slave. I have seen HMO landlords fail because they cannot navigate that tricky line between being the tenant’s best friend, and being their master and squire. (Both of which are unreasonable)!”
“There has to be a professional line drawn between yourself and your tenant so that you manage the relationship and expectations effectively. This is the way to keep tenants long term and keep yourself sane!”
Create an HMO that you’d live in yourself
It wasn’t until a landlord improved this statement and, unknowingly, created an anecdote that I’ll be using over and over again.
“I feel it’s important to create an HMO that I’d live in myself, if I was in the same circumstance as the tenant” she said.
With just the simple addition of “if I was in the same circumstance” this statement can now be ubiquitous and apply to so many more HMOs and situations.
Developing HMOs, contrary to what you see on Facebook, Instagram or on courses, isn’t about creating high-spec, high-end boutique finishes in all circumstances or conditions.
It’s about understanding your market properly.
Understanding tenant types
Sticking to the original sentiment “create an HMO that you’d be happy to live in” may mean that you’re actually developing a product that’s not appropriate for the tenant type or the proposed use.
It may mean that you over-spec, overspend, or alienate your target tenants type.
The circumstances and living habits of HMO tenants vary so much across locations and demographics.
What type of HMO would a young professional moving near London for the first time want?
What type of HMO would an Eastern-European factory worker moving to Doncaster for 2 years?
A university student in Newcastle?
A hospitality worker who comes home late from shifts or works night shifts?
A vulnerable person who requires supported living?
All of the above example tenant types have different needs and requirements, therefore ‘creating an HMO that you’d be happy to live in’ may not work, unless you add ‘if you were in the same circumstances’.
It provides individual thought, tenant empathy and makes the developer/landlord think about creating the best HMO possible for the tenants they are appealing to.
If you are interested in purchasing an existing HMO, or want some advice about developing a HMO property, you can get in touch with our experienced team on 01743 612 018 or email us at info@thepropertyadvantage.co.uk.
