You will have heard me talk about ‘Future Proofing’ your investment as the fifth part of the process of creating a high income-producing HMO. Can you really do this though? 

What about all the CHANGES that Government makes continually to legislation, policy, rules? How can you protect yourself against these changes and ensure that you are investing for NOW and in the FUTURE? It’s easy to look back and think how fortunate investors were years ago. No limits to the amount of interest they could claim on their mortgage; few limits on mortgage borrowing (even the riskiest of investors could borrow up to 95% LTV back then); limited HMO legislation and much more relaxed rules about housing standards. Ah, the rose-tinted specs of property investing.

True? Yes! But was that the shiny penny we all think it was? NO! In those days it was far easier to get into insurmountable debt and repossession was rife! You could own masses of property but not be making any real income as interest rates were far higher. Spareroom, RightMove etc were all in their infancy so you would spend FAR more on advertising (I remember lots of weekly ads in the local paper for example), and HMO rooms were badly thought of back then so it was not a great strategy (unless you were in the student market).

So we can all look and think that THEN was better than NOW. The truth is it was DIFFERENT! Not better, not worse!

With that in mind, how CAN you future-proof your investment and ensure your HMO continues to produce cash each month for you (and your investors)? Here are my 7 tips –

1) Always do a quality refurb to start with. If you scrimp and save on this part, you will regret it later! Ensure you do a detailed specification of works, have a clear project plan for your builder and stick to time and budget.

2)  Make sure the acoustic and fire requirements are met on your HMO before you finish it and snag it. Councils are bringing in more and more safety regulation so you need to be at the front of the curve here.

3) Keep up with the trends in technology and interior design. We fitted CAT6 cabling to many of our HMOs – not a great extra cost, but it is a massive benefit to tenants trying to log on to the wifi. Buy ‘Homes and Gardens’ once in a while and see what other people are doing in design trends. Borrow their ideas and use them to upgrade and cheaply furnish your rooms.

4) Schedule an annual Spring Clean to replace old cutlery, glassware, doormats. All the things that get grubby and soiled and make the place look a mess! It doesn’t cost much but it helps to keep the place updated, clean and tidy.

5) Develop a brand – what are you known for? What is your speciality? What is your USP? Even if you are using an agent, what is it about YOUR HMO that people particularly like? Ensure you highlight these things in your advertising.

6) Stay up to date with legislation changes so you can implement them when the time is right – the best way is to be a member of the RLA or NLA. They produce regular updates and you can go to their websites to find out more. Also, you can register with your local council to be an accredited landlord and go to their (boring but useful) meetings. You never know you might meet a tired landlord with whom you can do business there!

7) Understand the needs of your tenants and get to know them – what are the changes they are responding to in the marketplace and how can you meet those changes? Can you add in additional services or offers that will help them to stay and pay?

I would LOVE to know what your ideas are! Please share them here in the comments below!

To your growth

Wendy