HMO lending with Molo
House of multiple occupation properties are becoming an increasingly popular option for landlords, with HMO rentals growing by more than 9% in the last few years. Therefore, landlords are making more enquiries about HMO mortgages, and with Molo, they can benefit from:
- Lending on HMO properties with up to 6 rooms
- 75% loan to value on HMO homes
- Five-year fixed deals at 3.74%
The private rental sector in the UK continues to grow and now accounts for roughly a quarter of all homes. As demand increases, landlords are on the lookout for new opportunities in the rental market, and one of those is houses of multiple occupation (HMO).
Between 2018 and 2019, HMO properties grew from 8.6% to 9.%. There are around 500,00 rentals classified as “HMO”, with larger cities, in particular, becoming somewhat of a HMO hotspot.
It’s easy to understand why landlords are exploring HMO options. A house of multiple occupation can provide yields of up to three times higher than a single-let property. Landlords are also less likely to suffer from void periods, as each room is its own tenancy.
Consequently, they can continue to see cash flow, even if one of the rooms sits empty. Another key benefit is that of continuous rent. Even if one tenant falls behind, landlords can take some comfort knowing that they are still receiving rent from other tenants in the house.
However, HMOs come with more responsibilities than single-let properties. That means landlords need all the advice available to help them make the best decision, from understanding their legal requirements to whether or not the property needs a HMO licence.
It’s also harder to get a mortgage for HMO homes, so the more options available to landlords, the higher the chance they can fund their next buy-to-let.
At Molo, we’re pleased to offer HMO mortgages to landlords who have 12 months’ experience. They can borrow on HMO homes with up to six bedrooms and get a LTV of up to 75% of the property’s value.
Our five-year fixed deals come with 3.74 per cent, meaning landlords will benefit from a competitive rate when borrowing from Molo.
