Some investors when looking to buy a property to convert to HMO just look at how many bedrooms can be created. Whilst undoubtedly more bedrooms mean potentially more rent and more profit,  I would say that this is an overly simplistic way of looking at things. 

If you're thinking of buying an HMO in Birmingham then there are a few things you need to consider. I would say the first thing you need to consider is the location of the property.

Take a step back and put yourself in the shoes of your future tenants. Ask yourself the question, where would they want to live?

So for example, if you were thinking of creating an HMO which would be rented to young professionals, you would be looking for a house in an area that would appeal to such a demographic. Having amenities such as nice restaurants and shops nearby always bodes well but also think about where your future tenants are likely to be working.

Looking at a city like Birmingham a lot of people will be working in the city centre but not all of them. Those who are working in the city centre will need good access to it but won't necessarily want to live right in the city centre.  Indeed, suitable accommodation may not be available right in the centre of any large town or city at least within their budget.

With this in mind, you should probably be looking to site your HMO in an area with good links to the city centre.  Bus, train and tram links will always prove popular as it makes your tenants journey to and from work all the easier. 

Another thing which tenants in an HMO will appreciate is comfortable shared living space. Whilst not essential in an HMO, shared living space often improves the feel and comfort of your tenants and ultimately may result in them staying longer and you incurring fewer voids period.

Whilst assessing a property for suitability for use as an HMO there are a number of things you should be considering. 

1. How many bedrooms are you trying to create?
2. How many bathrooms are you trying to create? 
3. Do you intend there to be shared living space such as a dining area or a living room?
4. What is the name for the area,  are most HMO properties rooms with en-suite or shared bathrooms?
5. What is the ceiling price for a room in this area?

This is by no means an exhaustive list but at least you get you thinking in the right way?

So is Birmingham a good area to own an HMO?

The HMO market in Birmingham  is by no means saturated, but there is a lot of competition.  You really need to speak to an agent who knows the area and has dealt with HMOs before.  I've seen many times now two properties that on the face of it a very similar and in similar areas where one rents very easily whilst the other struggles for good quality tenants. One important thing to bear in mind when planning for your next HMO is that your HMO is only likely to be truly profitable if the majority of the time it is fully rented out.

One final word of warning, be very careful about areas with Article 4 restrictions. Just google “article 4 Birmingham’.

To find out where might be the best location for your HMO in Birmingham get in touch either by phone or by email for a free 15-minute consultation.