We are seeing more enquiries for HMO finance. This is a specialist area in which Hallcroft Finance has the expertise and can assist.

In order to meet the classification of a HMO, the property must be the tenant’s main or only residence. Where a property is let to students &/or migrant workers, it will be deemed to be their main or only residence.

Be aware there are very specific HMO laws and HMO regulations including in some circumstances having a licence. Check with your local council/ local authority for licensing laws. They may well also assist with fire safety, safety checks, mandatory licensing and building regulations.

The type of agreement you give to your tenants does not dictate whether a house/flat is or isn’t a HMO. A common mistake is assuming that an AST (Assured Shorthold Tenancy) contract means a property can’t be a HMO. This is incorrect.

If that house/flat is rented to 3 students, all from different families that would be classed as a HMO.

Estate agents as they rent properties have become much stricter around this point, which is great to see. Most agents actively help the owner of the building should they ‘stumble’ into the HMO space.

Here at Hallcroft Finance we are starting to see an increasing demand for HMO rooms. The ‘cost of living crisis’ & recent changes to housing benefits are being felt across the country. Tenants / potential tenants are looking to rent rooms rather than whole properties, in order to manage the monthly expenses.

Raising finance for HMO’s, either to remortgage or to purchase is a specialist area, with specialist lenders available. As such, speaking with one of our team may present options that are not readily available direct to you with lenders.

Further info can be found here : https://www.gov.uk/private-renting/houses-in-multiple-occupation