HMO or Not? And Agency questions...

[jampot]

First post, so here goes... ;)

I'm moving out of my current house in August and wanted to let it out in my absence. Its a newish build (Oct 2004), 2 storey, 4 bedroom (1 ensuite), 3 reception, kitchen, utility and conservatory.

I'm going to get some rental quotes from local letting agents, but because of the proximity to a large university, as well as a business park, it may be better in the long run to make my house available either as a student let, or let individual rooms to local "professionals".

Having roughly checked, I understand that 2 of the reception rooms could also be considered as "bedrooms", but I haven't decided whether to try and maximise the potential income or just cover my costs at this stage.

So if I rented the 4 bedrooms out to individuals, with shared lounge, kitchen, and bathroom (for 3, 1 gets the ensuite) is this a HMO?

I guess if I had any designs on letting 1 or more of the "spare" reception rooms out, I'd be better shutting them up before the place gets let, so people don't rely on them as communal areas...

Does anyone know of agencies who assist with the letting of rooms (rather than entire dwellings) or do most of them do?

Any checklists available with things I need to know / look out for? All landlords start out somewhere, so excuse my naivety... but I want to get it right, for my own sake as well as my tenants!

[Bel]

In addition,with HMO's, you cannot turn both receptions into bedrooms. You will need to provide a certain size of communal living space, and the kitchen area will have to be big enough to function for the number of occupants...your local council will help you.

You will probably find there are local agencies who cater to students. Ask their advice.

[jampot]

Thanks all...

I know some of the houses on the same development have receptions used as bedrooms - I've a couple of friends who rent rooms in them. More typically done with the "townhouse" style.

I did a quick check on my local Council's website:


The council operates an HMO Licensing scheme as required by the Housing Act 2004. Any HMO that is in a building of three storeys or more and that has five or more occupants must be licensed.

So it does appear that mine wouldn't need to be licensed because it doesn't meet both criteria.

http://www.welhat.gov.uk/housing/privatehousing/homesinmultipleoccupancyregister

I would actually prefer not to let to students, and would rather let to professionals / couples, or even a corporate let.

As 4 bedroom houses go, it is relatively substantial, and there's already a landlord on the development that does let mainly to non-students. Not that I want to go into competition - I think he has upwards of 30 houses! - but would just like to do something similar to cover my costs and be a reasonable investment.

There's a number of large companies in the area (I work at 1 myself) and building work recently started on a big Japanese firm's offices, so perhaps there's something worth looking at there.

Thanks for the student link - I'm going to speak to a couple of letting agents this week. The house is currently on the market, as my first plan is to sell it, but I'm nearing my own "deadline" for agreeing a sale, so would look to convert it to BTL over the summer if it hasn't got a firm offer in place.

[jampot]

I've been chatting to a local agent via email, and he has been most helpful.

Also mentioned the possibility of a Company Let Agreement, with a guaranteed income over 3-5 years.

It seems with the student route, or the CLA, I should be able to achieve the rental income I'm looking for in order to make the property "self sufficient" in mortgage terms, so I can successfully apply for a new mortgage on the place I'm buying to move to.

Questions:

1) as an HMO which doesn't require a license, will my BTL mortgage provider need to know on what basis it is being let, and will this limit my choice of products?

2) (silly question) what is the ballpark figure I need to consider setting aside in order to convert a 2004 built 2 storey house to be suitable for letting?