Students or Professionals? Which one is right for your HMO? A lot of people often wonder what would be best for their HMO and especially a lot of landlords based outside of the city. It comes down to a number of factors; area, size of the property, number of bathrooms etc. Hopefully by the end of this article you will know what will be the best fit for your property.
The foremost benefit of having students in your property is that they are a secure tenancy. If you can get a group of students in your property at the start of the term, you can guarantee a 10 month tenancy agreement at the very least. If you treat your tenants with care and keep the house in order, they will be more likely to return to you for another year. Students are also great because they tend to move in groups. Strangers turned friends in first year of university tend to leave the bland, cold feel of student accommodation for a more homely environment for their remaining years. The positive side of this is that they are more likely to be okay with sharing bathrooms, meaning en-suites are not an essential for students.
Of course the down side to having students is they will need to have access to their university campus; meaning if your property is 40 minutes away, chances are they will opt for something closer. If your property is on a main bus route, this will be a huge selling point when it comes to marketing. You will need to stress how easy it will be for them to get to university should they decide to view your property. A lot of the students who are not from the city might feel intimidated by complex travel plans and again opt for something within walking distance or on a bus route that is just 10 minutes away.
Professionals also have their pros and cons but are generally much more versatile than students. For starters, you will most likely be filling your property with individuals who do not know each other prior to moving in. The main downside to this is sharing a bathroom with strangers is the first concern, so as many en suites as possible is recommended. A lot of professionals looking for an HMO work long hours anyway and just want somewhere to lay their head down, but it is definitely a concern for most.
Where students are infrequent and in groups, professionals are looking to move all year round. If for some reason a student moves out halfway through the year, chances are you will have an empty room for the rest of the year. Professionals may have shorter tenancies (averaging 6 months) but they are more frequent to replace each other when they go. The location of your property is usually taken into consideration when they are looking for a property but in a city like Liverpool where you can get from end to end in about 50 minutes, this isn’t a massive concern for a professional tenant if they can get a room within their budget. This allows you to invest in areas of the city that aren’t saturated by student HMOs and give a nice unique selling point in a different part of the city.
There are pros and cons to having professional or student tenants but it ultimately comes down to your investment strategy and what you have to work with. It should definitely be taken into consideration when planning out your targets for a property.