Being a landlord of an HMO is not an easy task, particularly if you have multiple HMO’s to manage. Remember, a property is only considered an HMO if it’s rented by 5 or more people. If you have more than one or two HMO operating properties, investing in a property management company is a smart decision.
It means that you will reap more benefits from your investment, rather than getting tied up self-management responsibilities of multiple houses and dealing with multiple tenants. So what should you look for when hiring an HMO manager?
It’s a good option to hire a HMO manager if you live some distance away from your HMO’s, because limited accessibility to them may not be feasible to deal with all the issues that may arise. A good HMO manager or managing company will take care of these problems for you, no matter where they are.
Having said that, if your HMO’s are in a similar area, hiring someone who is also in that area will help resolve issues in a much quicker fashion, meaning your tenants are kept happy and there’s less change of vacancy, which as we know, means less profit.
Proficient in Licensing
The process of owning and renting an HMO needs to comply with the relevant legislation and licensing requirements. The Tenancy Deposit Scheme [https://www.tenancydepositscheme.com/news/blog/hmo-properties-best-practice-for-landlords/] lays out that if you operate illegally by having an unlicensed HMO, you could be fined up to £20,000, and that’s not evening including court costs. Hiring a property manager or company that has plenty of experience in this field (i.e. have managed HMO’s before and been successful) will therefore be of great benefit to you.
If you hire an HMO manager who is proficient in licensing, you will have peace of mind that all the licensing requirements have been accounted for, particularly following the Housing Health and Safety Rating System (HHSRS), which can be confusing to understand.
Property management professionals are required to ensure that the Government [https://www.gov.uk/house-in-multiple-occupation-licence] licensing regulations are adhered to, so that you don’t have to worry about getting it right.
Experienced at HMO Management
A proficient HMO manager will also be helpful in dealing with other requirements such as fire safety regulations, water supply and drains, gas and electricity and waste disposal. You may be getting an idea of why this is particularly helpful if you have multiple properties, because there’s lots to consider and think about when you’re the landlord of an HMO.
They will also offer services such as conducting inspections of your property and organising the relevant maintenance that needs to occur. They can even help you with advertising and finding reliable, good quality tenants to ensure that you make a reasonable profit from your investment without having to deal with people who don’t pay rent on time, or generate other difficulties in the process.
If you’re worried about costs, shop around to try and find a property manager or company that will charge you a competitive rate. According to AMS Housing, most companies charge between 5-10% of your rent revenue payments.
This is quite affordable, but it’s up to you and what you can comfortably afford. Doing your research to ensure you are getting the best deal that is right for you and your needs is most important during this process.