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Property management becomes more difficult when multiple occupation happens but there are companies skilled in managing this kind of situation. Abode, for example.
We will look to consider the scenarios that will mean multiple occupations, explore the difficulties, and then see how things are managed effectively.
What is an HMO?
An HMO or “House in Multiple Occupation” is a property that is rented by three or more people who are not from the same household. They may be colleagues, associates, friends, or family. The situation can be described as a house share.
Scenarios Involving Multiple Occupation of a Property
Many people will occupy a property as students, professional people, or those working on a building project. It is the way to afford property rent and be close to a studying or working situation.
Students may be on different university courses, whether that be studying medicine, science, or one of the humanities, but they will all come together because they attend the same university or college campus. They will occupy a property that will house several other students, either in the same room or ones adjacent to each other. This will be carefully controlled by property management companies but not to the extent that freedoms are taken away completely.
Professional people will all have employment but will potentially be single and so unable to afford a property all by themselves on their salary. This is where they will get together and live in larger properties by way of a house share. They make good tenants in that they earn a regular wage to afford the rent between them.
Then there may be groups of builders working on the same project that will share a property close to a construction site. This accommodation will likely be funded by their construction company.
Difficulties of Managing Group Tenancy
In England and Wales, it is necessary to have a licence to rent out a large HMO.
A company can work on your behalf to manage the situation when you own the property as a form of investment and are looking to earn money or an income off it.
Financially managing HMOs can mean collecting multiple rent payments from the different tenants living within one property. It is not as straightforward as having one rent per property to collect, depending on the arrangement.
Those renting multiple property situations will need to accept that it may be necessary to share bathrooms, kitchens, or toilets.
Effective Management of HMOs
Companies can take care of the accounting and the maintenance of shared properties on behalf of investors. This will be about keeping all of those within the property happy when they are paying money to rent the property. Things will invariably wear out or go wrong over time and need fixing or replacing, and this can be taken care of by management companies on behalf of those that own the property. It is harder when there are more people to deal with per property.
The skills staff of property management companies need to have will be a knowledge of buildings and what can go wrong with them, a list of who to call, and empathy for tenants when there is a problem to sort.
The hassle of dealing with tenants will be taken away from property owners by effective property management in respect of HMOs. This includes investing in the finest HMO insurance around.
The safety of the property will need to be considered and whether the property is safe for any tenant, let alone multiple of them. Then there will need to be some limits as to how many are staying inside a property at any one time. Rules will need to be set out about who stays. References will be taken to maintain the kinds of tenants that are in the interests of property owners.
There is much to think about with HMOs and multiple property management. There are more people to think about. This can all, however, be taken care of by a company that will know how to effectively manage these kinds of living arrangements.
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