Glossary – H

Headline Rent – The overall rent that is paid under a lease, excluding any rent-free or reduced rent periods. This creates an inflated rate known as the headline rate, which is most commonly used on open market lettings and lease renewals.

Heads of Terms – A non-binding document outlining the main issues relevant to a unsettled partnership agreement. Both parties will fully understand what they are subject to, and reduce or abolish any misunderstandings from each party once a contract is drafted from this framework.

Hereditament

HMO (Houses In Multiple Occupancy) – A house in multiple occupation is a property rented out by at least 3 people who are not from 1 “household” (e.g. a family) but share facilities like the bathroom and a kitchen.

Hold Period – The course of time over which the investment is assumed to be held until otherwise utilised.

Home Information Pack(HIP) – An information pack organised by the landlord before marketing a property for sale, it will be contain specific information relating to the premises such as EPC’S, land registry documents and sale statements.

Household Contents Insurance – An insurance policy that can be taken out to cover most of your household items and belongings against theft, loss or damage. These policies do not usually cover any belongings that are taken out of the house such as cameras or sports equipment.

House Price Index – A method of representing changes in house prices over periods of time. Usually house price indices are accompanied by other important information such as average property prices, and breakdowns by region or type of property.

Hurdle Rate of Return – The minimum acceptable rate of return on a investment that is required by the investor. Therefore the riskier the investment, the higher the hurdle rate.

Hypothetical Lease Terms – Used under a rent view clause as the main basis for valuation. The rent review clause will determine the precise terms that will be assumed while disregarding other matters, as a hypothetical letting of the property in question at the review date