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02.07.2021

HMO is the Name, Property is the game

Before We get started I would like to introduce myself.

Hello, I’m a new angel over at Sales & Lettings and from now on I will be here posting here with property information and advice

A bit about me!
I've been an estate agent for over 4 years with my main focus on sales, I've been heavily based in Cathays for 3 of them, which is Cardiff’s rental hotspot, it been a fun/hard time navigating sales in an area with high amounts of rentals but the challenge has been fun and got me to the position I am today.

Coming from a heavily based corporate residential property estate agent and based in a not so residential area I have learned a lot about the property market for investment and residential sales including trying to sell and market property in an area that not a lot of prospective buyers are looking, we good success being market leaders in the area. 

The other year of my estate agency career has in the area of high residential sales which we broke company records for Cardiff with sales and improved the business over 100% within a pandemic. Although I had great success in a residential market, I missed the part of the business that was Cathays and investments.
With the family business being in property investments, I feel I was better suited in this market.
So enough about me let's get onto the first blog post.

P.S This is me getting my first sale for Sales & Letting Agents - With many more to come.

 

HMO is the name, Property is the game

It’s always been said that the best time to buy property was 10 years ago, and the second-best time is today. 

Nothing runs more true than an investment property, with our expert knowledge and our location in the centre of Cardiff's busiest HMO district in Cardiff, if you're a seasoned professional in the property business or new to the very big pond when you first invest, we are here to help get you a property.

It will be your best investment even if it fails you will get the confidence and knowledge of making money work for you not just working 9-5 for money.

If you have an existing portfolio or just getting on the ladder, we can help.  being the No1 letting agent for Central Cardiff according to Rightmove data we have all sorts of options for all types of investors 

 

Location

Location is key for any HMO property, you need to make sure when renting to multiple people you have the market that will rent such property, you want to be looking for high-density areas with lots of jobs or students or both like Cathays.

 You should look at whether the location of the property is desirable for people wanting to live in an HMO e.g. near a university, hospital or city centre. Different locations will also provide different rental yields. Research of the competition is also key. If there are lots of untenanted HMOs in the area, it will drive demand down but with students in Cathays, we have filled all our HMO’s this year even with the pandemic we are on for a record year so there are no signs of slowing down.

 

Tenant Profile

 This can be just as important as the location. Choosing the right tenants for your property and getting tenants that get along will minimise disruption and complications as the tenancy goes on and ends, you must also look at your lender’s requirements if you have a mortgage on the property. Ideally, the best way to pick these is to get the location perfect and the correct tenants will follow.

 

The property

 Picking the right property is key to a good investment, you need to be appropriate and desirable to your target audience. You should make sure your property is modern and clean and your property will be looked at and rented first in most cases - Would you want to live in a grubby run-down property? - No, well most people would agree with you. Make sure you give plenty of amenities, living space, waste disposal and washing facilities are ample. The properties that offer the most to the tenants tend to rent for the most and as long as you're sensible on a budget this will mean a higher return.

 

Affordability 

 Make sure your figures stack up and that your rent covers your monthly repayments on these properties, you don't want to find yourself losing money, keep in mind future interest rate changes so give yourself a good bumper in between your costs vs rental income
Everything so far seems straightforward and easy but you may also find yourself without tenants so make sure your contingency plan/funds ideally this would be around 3-6 months - you can also take out protection in form of insurance on HMO properties (so look into this) but if you cover your bases on the first 3 points you shouldn’t end up in this position but with any investment make sure you know the risks before entering into the investment. 

 

Repairs 

 This is in line with the affordability but has its own section on this list as these can be something you not prepared for, you can be sipping a cocktail on a beach and get a phone call - “your tenants don't have heating & hot water, and you need to get this done immediately, this you can not predict, but being prepared with some funds does avail for things like this is needed you may also find yourself unable to find a gas engineer or a repairman for other repairs, at this point you may want to look at getting yourself a managing agent to deal with all aspect of the property so you can sit back and relax with your cocktail.
This is a service we can offer and find out landlords are very pleased with our services. 

 

Regulations & Fire Safety

You must make sure that your property meets all the requirements for the rules and regulations and comply with the HMO and rental compliance, Getting a licence in Cathays is almost impossible with the council not currently give any new HMO license to properties without one, so make sure you’re purchasing a property with a license or your confident you can get one.
Other essentials to letting a property are linked to fire safety meaning you will need fire doors, smoke alarms and fire escapes are all in place with adequate signs and lighting.

 

Tax

  Any investment comes with tax eventually, so speak to an expert on what you need to pay and when you need to pay it.





Creating a sustainable HMO business can help you be successful even in an uncertain market. Your business should be founded on sustainable services and products, and then the right measures need to be put in place to build sustainable foundations that can weather the storm of uncertainty. If you follow the above steps you should be well on your way to a successful HMO.

This week we at Sales & lettings Angels are pleased to show off our new investment properties.

All our properties in this blog will have an HMO license, which is a great start
Some of these properties are ready to go and others have the possibility to add to the rental yield with some modernisation

First up we have 2 Letty Street

Sales & Letting Angels are proud to offer the opportunity to acquire a NEWLY DEVELOPED, fully compliant, licensed HMO in a prime location on Letty Street in the heart of the Cathays 'Golden Triangle' Currently let at 400PP.
Due to the location of this property, the demand is unlikely to lessen, with the property just being launched 

 

This immaculate semi-detached property has been finished to the highest standard, with the layout and rooms carefully considered to offer tenants the very best facilities and comfortable living space and landlords a LOW MAINTENANCE, quality investment. There is also scope to INCREASE RENTAL YIELD as 7.2% is based on £400 PCM excluding bills with limited time to let, for next year we hope to achieve £425, given a longer time to advertise to potential student tenants.



Up next we have some properties with potential 

10 Whitchurch Road

Sales & Lettings Angels are delighted to offer this fantastic 6 bedroom, 2 bathrooms with a separate WC in Whitchurch Road. Currently rented until 31st June 2021 at £270 Per room £1620 (including internet but excluding other bills). The property currently achieves a gross yield of 5.8% with massive potential to increase. This fully compliant, licensed HMO is in a fantastic location for students and young professionals. Due to the location of this property, it has proven popular with students from Cardiff University, Cardiff Metropolitan University and those based at the Heath Hospital campus.



This mid-terraced property has been maintained as an investment property for a number of years, with the layout and rooms carefully considered to offer tenants practical and comfortable living space and landlords a LOW MAINTENANCE, quality investment. There is also scope to INCREASE RENTAL YIELD as further modernisation of the property would lead to an increase in rental income

We estimate up to 60-100pp depending on the finish 

 

Finally, for this week, we have

85 Malefant Street 

Sales & Lettings Angels are delighted to offer this fantastic 5 bedroom, 2 reception room with 1 bathroom and a separate shower room in Malefant Street. Currently rented out at £340 Per room £1700 (including bills). The property currently achieves a gross yield of 6.6% with the potential to increase. This fully compliant, licensed HMO is in a fantastic location for students and young professionals! Due to the location of this property, it has proven popular with students from Cardiff University, Cardiff Metropolitan University and those based at the Heath Hospital campus.

This mid-terraced property has been maintained as an investment property for a number of years, with the layout and rooms carefully considered to offer tenants practical and comfortable living space and landlords a LOW MAINTENANCE, quality investment. There is also scope to INCREASE RENTAL YIELD as further modernisation of the property would lead to an increase in rental income.

This also has the potential and space to convert to a 6 bedroom HMO to further increase the yield.

 

So with everything I’ve mentioned today, there really is no better time to turn your bank balance into a solid investment ready for retirement or just a bit of extra cash a month to spend on holidays when we are free to travel again 


So for a small-time investor or big-time investor, there is no better time than the present to buy, get in contact today on 02922 331 425 for some advice or to find out about the other investment opportunities we have! 

 

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