HMO is a fantastic strategy for Cashflow...
Title Splitting is the only strategy that enables you to Title Split a HMO to access Capital Growth
We can show you how to have capital market growth and HMO cashflow in the same property???
The benefit of HMO to Title Split
One of the best ways to ensure you achieve Money In Money Out on your project (MIMO) is to make your HMO into a Suis Generis HMO (more bedrooms/units). This is great news for your original valuation, however in future valuations , this strategy could end up in lower valuation and here is why...
- Rents in HMOs (particularly in busy HMO areas) tend to be at their highest when you have refurbished your property.
- Market pressure and competition can have an impact on your ability to increase rents.
- In saturated areas you may end up with voids at some point in the future. This can impact valuation.
- Increased bills (bills included) will result in a decreased suis generis (investment/commercial) valuations.
- Rent and yield are used to value your HMO
- Commercial/investment/large HMO valuations are based upon the rent of the property and the average yield of the area.
- Small HMOs are based on rent coverage and comparable market values (capital valuations).
- In many instances if you do not increase your rents, your valuation in 2 or 5 years will be lower (when based upon rent and yield).
- Finally when youi sell you can only sell to another investor
HMO to Title Split
Creating leasehold apartments within freehold buildings is the answer!!!
- This will give you access to bricks and mortar valuations (in many areas these can be 20% higher than a block or suis generis valuation).
- You will be able to choose a commercial valuation or bricks and mortar valuation (split value), dependent on what works best for you.
- You can sell to individual retail buyers or an investor in time...your choice.
Harriet Dunn and Rachel Knight are the foremost experts in this strategy in the UK. We show you exactly how to make profit from this strategy, just like with a HMO.
In our online masterclass we will tell you exactly why this strategy is essential to ensure you get the maximum valuations and sales prices in the future for your HMOS and blocks.