Do you need planning approval to convert a property into a HMO?
HMO Housing falls under C4 of the Use Class Act i.e. Houses in multiple occupation, which is defined as small shared houses occupied between three and six unrelated individuals, as their only or main residence, who share basic amenities such as a kitchen or bathroom. Certain councils need planning approval where article 4 is in operation. Manchester, Birmingham and Leeds councils require one of these, but Salford and Liverpool councils don’t. Therefore you do not need planning permission to convert a Use Class C3 (Family Dwelling) to become Use Class C4 if Article 4 is not in operation. However if you want to convert a house into a HMO with more than 6 beds then this falls under the Sui Generis Use Class which will require planning permission.
What type of property should I purchase to achieve high yields?
One which has been refurbished to a high specification with regards to furniture and white goods. Newly renovated student houses which include all the necessary features and equipment such as TV and broadband and with bills inclusive. Ideally investment properties should be located close to major Universities and managed by a HMO specialist.
How do I know my property will be let by Mistoria?
Mistoria have achieved 100% occupancy in Salford and over 90% occupancy in Liverpool for academic year 2015/2016 and 2016/2017. We manage over 265 properties across 7 cities and are highly experienced at finding the right tenants for our clients.
How long have you been established for?
We have been in the property business since 2009 and we provide total arm chair investment opportunities. This includes providing Property Investment Advice, Project Management, Sales and Lettings, Property Management, Renovation, Furnishing, Utilities and Maintenance.
How is the Gross Rental figure calculated?
The Gross Rental figure is calculated by multiplying the rental £ price per week per person x 52 weeks x number of bedrooms in a property.
How is the Net Rental figure calculated?
The Net Rental figure is calculated by deducting the management charge, tenant finder fees, voids, utility charge and insurance from the Gross Rental income.
How is the ROI (Return of Investment) calculated?
ROI is calculated as follows:
ROI = (The Net Rental Income / Sale Price of Property) x 100 to give the % ROI
The difference between cash yield and geared yield
If you use cash proceeds for the purchase then you will be generating a cash yield. If you use a mortgage to finance the purchase then you will be receiving a geared yield.
What are the different types of Valuations?
Market value of a property based on the Net Rental income.
Buy to Let Valuation
Market value of a property based on sales comparable with properties sold within a mile radius and sold during the last 6 months.
Vacant Possession Valuation
Market value of a property which is unlet and available for occupancy.
Forced Sale Valuation
Market value of a property if forced to sell at an auction.
What is the difference between HMOs and licensed HMOs?
A HMO property is a property with 3 or more unrelated people but only has 2 stories. A licensed HMO is a property over 3 stories and has more than 5 people occupying it.
What is the difference between Buy-to- Lets and HMOs ?
A buy to let property is one that has been let out to a single family (single dwelling) or individual, whereas a HMO (Houses of Multiple Occupancy) is a property that has been let out to multiple, possibly unrelated individuals. They will have either rented room by room, or if they are connected in some way, as a house share.
Why Student Accommodation?
The unfortunate reality is that there is simply not enough quality accommodation for under graduate students and there is a massive shortage of HMOs. Many universities struggle to house students due to the increase student numbers. The surge in student demand for accommodation has also been driven by the increasing demand for higher quality student homes.
Can Buy To Let Still Work?
Every day it seems there are more headlines about how the Government is making life harder for buy to let investors; tax relief is being cut and tenants are complaining. But it is still possible to make good returns on your property investment – you just need to choose the right property company to partner with. Finding a company with a great reputation in the area where your property investment is based is the first step to making the best use of your investment.