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BTL / HMO companies...dodgy?
rossontheweb
Posts: 9 Forumite
Ive seen a few companies offering investments in Buy to Let properties that are HMOs - I guess usually student houses.
They offer good returns and they manage your property, plus you own the freehold....so whats the catch?
Does anyone have experience in these schemes - anecdotal or actual, just wondering!
thx
They offer good returns and they manage your property, plus you own the freehold....so whats the catch?
Does anyone have experience in these schemes - anecdotal or actual, just wondering!
thx
0
Comments
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Who forks out the cash to buy the property?0
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rossontheweb wrote: »Ive seen a few companies offering investments in Buy to Let properties that are HMOs - I guess usually student houses.
They offer good returns and they manage your property, plus you own the freehold....so whats the catch?
Does anyone have experience in these schemes - anecdotal or actual, just wondering!
thx
Well they can be very good, in general the company policy is: buy a rundown (but structurally good) house at auction, cheapish, do it up, let its out and then sell the whole property, tenants etc included to a landlord, then manage the property for them.
They make the money on the initial price increase, and the initial rent and you then take over.
Obviously every industry has its problem companies, but as a general investment, you get a good property, done out to spec and fuy managed, in theory just watch the pennies drop into your bank account.0 -
Just to give a balanced view there are lots of HUGH student letting companies heavily in debt at the moment to lots of lenders
Oversupply of expensive student PADS with en suite rooms from £130 a week on 52 week contracts with a drop in student numbers due too £9000 a year fees.
Companies are selling student pods !!!! A room in a block of flats so no lender will give a mortgage.
If you buy the whole refurbished property as the landlord you need HMO licence which many councils are refusing due to Article four.
Lots of cheap large student properties on the market as Landlords have gone bankrupt
You have been warned0 -
theartfullodger wrote: »If these properties are such fantastic cash-generators & bargains... why would anyone with half-a-brain be selling them??
Best money is made out of the refurbishment then subsequent management fees. Rather than tying up capital earning a pittance.0
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