6 Common Challenges Faced by HMO Landlords (And How To Avoid Them!)
When it comes to HMO property management in Liverpool, there are a few key challenges that every landlord is likely to face from time to time. However, the good news is that it’s possible to avoid these pitfalls by following some expert advice.
Here is our guide to the six most common issues that HMO landlords face, along with some tips to help you deal with them effectively.
1 – Regulatory Compliance
When running a HMO, it’s imperative to be aware of all the applicable HMO regulations and to ensure compliance with them. If your property will be home to more than five households, you’ll need to obtain an HMO licence. But even if your property is smaller, it’s still important to check whether there are any relevant HMO licensing requirements in your area. Some local authorities require all HMOs within their areas to have a licence, and operating without one will leave you open to legal action.
Top Tip:
Before advertising your HMO to prospective tenants, make sure that you’ve checked out all the HMO licensing requirement in Liverpool, and that you’ve obtained the necessary paperwork.
2 – Tenant Turnover and Management
Of course, you can’t run a HMO without tenants, but dealing with your property’s residents can be time-consuming and stressful. Attracting tenants in the first place can be hard work, and then you’ll need to run a rigorous tenant screening process, with tenant background checks to ensure not only that they are legally entitled to live in the country but that they can make their rent payments on time.
HMOs typically have a higher tenant turnover than single family properties too, so dealing with tenant turnover management can also be surprisingly troublesome. It’s also important to remember that at some point, it’s likely that you may need to spend time and effort on tenant disputes resolution.
Top Tip:
Maintaining a positive relationship with your tenants can make it far easier to manage them in the long tun, and the key to that is effective communication. Make sure that your tenants know how to get in touch with you, and that they can easily make contact as and when they need something. When you foster angood landlord/tenant relationship, you’re likely to reduce your turnover and minimise the chance of disputes arising.
3 – Maintenance and Repairs
Property maintenance in HMO properties can be a real headache. These types of properties tend to have more maintenance requirements when compared with single family rentals. More residents, paired with a higher tenant turnover can lead to more wear and tear and, in turn, the need for more repairs and replacements.
Top Tip:
One of the best ways to streamline the process of maintaining your HMO is to use a trusted HMO property management company in Liverpool, that can handle everything on your behalf, saving you time, effort, and stress.
4 – Financial Management
While one of the top reasons for becoming a HMO landlord is to generate an attractive income, financial management for HMO landlords can turn out to be a major hurdle. There is a far higher need for careful cash flow management for HMOs when compared with single family lets. Managing the expenses, income, and profit and loss statements for each of the property’s individual households can prove challenging, not to mention the essential job of collecting rent.
Top Tip:
Use software that is specifically designed for landlord use to simplify the process of managing your accounts or employ the services of a skilled and experienced financial adviser with expertise in working with HMO properties.
5 – Legal and Liability Issues
Being a landlord comes with many responsibilities, and there are numerous legal obligations for HMO properties to comply with. From meeting all the stringent requirements for fire safety in HMO properties to ensuring that each room meets the minimum size stipulations, there are many health and safety regulations in HMOs that unsuspecting landlords can fall foul of. Then, of course, there’s the risk of a tenant holding you liable for an injury or some damage to their possessions that has occurred in the property.
Top Tip:
One of the best ways to protect yourself from liability issues as a landlord is to take out specific insurance for HMO properties. With HMO landlord cover, you’ll have peace of mind that you’ll be covered should the worst happen.
6 – Community Relations
Being a HMO landlord does unfortunately open you up to a greater chance of experiencing issues with the property’s neighbours. Community relations for HMO landlords can be problematic due to the nature of the property, especially if students or young adults are living there, with noise complaints in HMOs being especially prevalent.
Top Tip:
From the get-go, you need to ensure that you’ve set out clear expectations for your tenants in terms of the behaviour that is expected of them. You should also take the time to meet the people living in neighbouring properties and check in with them regularly to ensure that they are no issues that need addressing.
Dealing With HMO Property Management Challenges
As you can see, landlord responsibilities in HMOs can be quite challenging, but working with an experienced and professional HMO property management company in Liverpool, like Portus Lets will make life much easier, saving you time and effort, not to mention stress.
Call our team today on 0151 329 3538 or email us at hello@portuslets.co.uk to find out how we can help you.