HMO Landlords LOOK TO switch On Back Of new government crackdown

Landlords who rent to multiple tenants face tough new licensing rules from this month. As a result, Bath-based property owners are now looking at possible alternatives on where they can place their cash, with the city’s leading new property development becoming the focus of attention. Although HMO licensing – houses in multiple occupation – already exists to landlords who rent their properties, from October 1 any property let to five or more tenants from two or more households will now need a license, regardless of how many floors the property has.

The result is that some 177,000 property owners across the UK will have to meet new minimum standards on room size and safety or risk receiving a fine up to £30,000 and possible criminal prosecution.

With some areas of Bath, particularly those around Oldfield Park, having a higher proportion of HMOS, the new rules could now see these properties return to owner occupiers as landlords switch their investments elsewhere.

Danielle Simpson, sales manager at Crest Nicholson said: “The new HMO rules are part of an effort to clamp down on overcrowding and challenging landlords who cram lots of tenants into small properties.

“Also, many landlords who let out well-kept properties will have to comply with the new rules and could mean them having to fork out on expensive property upgrades.

“The result is that some will look to sell up and invest their cash in new properties that are easier to manage.”

Of specific interest are two of the city’s newest landmark buildings at the impressive Bath Riverside development which is located on the banks of the River Avon.

Called Royal View and Sovereign Point, their curved design and stunning central atriums have clearly appealed to those looking to rent in the city with all available rental properties in Royal View now taken.

Fortunately, those looking to invest can still buy one of the two-bedroom apartments in Sovereign Point and is where many property experts believe the smart money will be invested once the new HMO laws start to take effect.

Danielle added: “Good monthly rent and excellent capital growth makes these properties particularly attractive with annual yields coming in around the five per cent mark.

“Why worry about all the various issues and problems associated with a HMO when you can get just as good a return by investing in something new.

“In Bath, strong demand for high-quality rental accommodation has resulted in a shortage of property for those wanting something of a superior standard. And with Bath Riverside being the only main new development in the city therefore places it high on the shopping list for those looking to rent.

“Other elements to consider are things such as affluence of area, proximity to the local amenities and city-centre and whether there are any universities close by.

“Sovereign Point fits all these criteria as well as a whole host of aesthetic considerations and is ideally suited for today’s typical tenant.

“The central location means the train station is close by which is handy for those who might work further afield.

“Tenants who live here will also have the advantage of having everything right on their doorstep and is why local letting agents are appealing for more properties.

“It really is the best option in Bath at present.” For further information call 01225 463517 or visit www.crestnicholson.com/bathriverside

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