HMO Property management
High Yielding Professional HMO'S sourced for you
We specialise in:
• Sourcing properties that can be converted into high yielding HMOs for professional tenants in the North East of England.
• We project manage the HMO conversion.
• We find you tenants through our established lettings business - NGU Homelettings.
• The same lettings business can provide full management to look after your new tenants to provide an armchair property management service.
We first of all source a property which is in a high demand area for professional workers and meets the following criteria:
• Nearby transport links
• Nearby schools
• Above UK average employment in the area
We then make sure that the property is suitable to convert to a HMO for professional tenants:
• Often the property will have a separate living room and diner that can be converted to additional rooms
• The property will have large rooms that can be made into en-suites
• The property will often have a loft that can be converted into additional rooms
We will provide a schedule of work and costings to convert your property into a HMO (we will project manage the development).
Your property will need to meet set criteria to be either a licenced or unlicensed HMO depending on the number of rooms and floors it has. We will liase with the local council and complete any planning applications or licencing paperwork if applicable on your behalf.
Once the development is complete we will provide the furnishings and start looking for tenants for you straight away via our established lettings agency - NGU Homelettings.
Why a HMO rather than a traditional 2 or 3 bed semi-detached or terraced?
3 words-high rental yields!
You may be just starting out on your property journey or have a small portfolio but if you think that you are happy to achieve five to eight percent yields and approximately £200 in your back pocket per property after you have paid all your bills then you need to think again. Here is a an example with real figures-a 4 bedroom property in the North East, typical rents are £450-£650 depending on area and condition. A 4 bedroom HMO in the North East will produce rents from £1,500-£1,900. You do the maths!
||Simple question for you? Do you believe that one day, you will not live in the world given to you, but you will actually live in the world that you dream of!
Letting HMO Professional Tenants
NGU Homelettings has been successfully letting properties in the North East of England since 2008. We manage over 600 properties and we own over 150 properties ourselves. We provide an expert, professional and accredited service. We are ARLA registered and are a member of the Property Ombudsman for Lettings.
We specialise in
- Single lets - experts in benefit & professional tenants through attention to detail
- HMO Professional lets
HMO Professional Tenant Find
- We find quality vetted working tenants and charge £100 plus VAT finder’s fee per room
HMO Full Management
- We provide an armchair service to allow you to have a high yielding HMO
- We organise the annual safety checks - gas certificates, electrical appliance tests, smoke alarms etc.
- We collect the rent
- We organise any maintenance upon your behalf depending on your spend limit
- Our fees are 12% plus VAT
How the process works-start to finish
THE BUYING STAGE
- We present the financial figures showing how much it will be to purchase, convert and the rent that can be achieved on your selected property. We aim for any HMO Property that we source to be refinanced (if desired) to allow the purchase price and development costs to be mostly taken back out through the up lift in the property’s value after the development. Most of the time expect to leave in between 10-25% of your initial capital investment.
- Before we can source a property we must see proof of funds to confirm any investor is in a position to buy. We do this to confirm an investor is a “Serious Investor”.
- There is a waiting list due to the interest that we are currently receiving. The reservation fee that will be required is £1,000 which will be deducted from the final development and project management fee.
- We can recommend a mortgage advisor to you at this stage if you need to speak about finance options if you are not a cash buyer.
- Once you have confirmed you are happy with the property we have presented to you, we will put an offer in on your behalf which hopefully will be accepted. We work closely alongside Estate Agents in the area and due to them knowing that we have investors waiting for properties that are suitable to convert to professional HMO’s, they often present the properties to us first before they go onto the open market.
- We both sign contracts agreeing that NGU Property Refurbishments will project manage the conversion into a HMO.
- The property completes and you are now the legal owner.
CONVERSION INTO A HMO
- NGU Property Refurbishments re-confirms the initial development costs to convert the property into a HMO and confirms the time frames for the completion of the development. This is produced in a document called “a property condition report costing” and is signed by you to confirm that you agree with the terms and conditions of the HMO project development.
- A HMO project development takes 14 weeks from start to finish (12 weeks to develop the property, 1 week to snag and the remaining week to furnish).
- We have specialist HMO tradesmen that only work on this side of the business. To make sure HMO developments go to plan, we need a minimum of 30 days’ notice to fit any new HMO development project into our current schedule of work.
- You pay 50% of the development costs before work can start.
- Once the property development has been completed, the remaining 50% balance needs to be paid within 7 days (please note you must have the finance to pay for a project development and it must not be reliant on a refinance strategy).
TENANT FIND AND FULL MANAGEMENT
- We will advertise your new HMO on all of the relevant websites to get it rented quickly with quality tenants. Advertising for your property begins at week 12, giving us 2 clear weeks to find you tenants before the development is finished.
- All rooms will be “staged” to provide professional photographs to attract the best working tenants on the market.
- We will credit check all new tenants and verify their employment details and sign them up to a 6 month short hold tenancy agreement.
- An inventory will be provided of the communal areas which will be updated annually.
- A furniture inventory will be made of the communal areas which will be updated annually.
- A separate inventory will be performed on individual rooms when a new tenancy agreement begins.
- NGU Homelettings details will be provided to your new tenants so we can collect the rent and organise any relevant maintenance when it occurs.
- Your property will then be inspected every 3 months by a member of the NGU Homelettings team. This inspection will be an informal visit and feedback will be provided verbally. An NGU representative will also collect any money that is received from the washer and dryer use (£1 per washer use and £2 per dryer use).
- Your HMO property will have the communal areas cleaned every 2 weeks and the tenants will have the option of having their own room cleaned for an additional £5 extra per week on their rent.
- Every 6 months a formal property inspection can be organised to confirm its condition (we highly recommend this) and then we will organise an annual inspection thereafter.
Help and advice from our experienced and friendly team is just one step away: