HMO Property Mortgages

The team at Charleston have access to the very best mortgage rates and products in the market, with our experience and dedication towards customer satisfaction, you are in safe hands when choosing to come to us to provide your mortgage solution for either HMO or Multi unit buy to let mortgages.

  • No upfront fees
  • Instant Decision in Principle
  • Licenced & Unlicenced HMO's accepted
  • Typical LTV 75-85%
  • Market leading HMO Mortgage Rates
  • Specialist HMO Advisors

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What is a HMO

A HMO (House in multiple occupation) is a property that is let to multiple different households

For the property to be a HMO the whole building, or even part of the building needs to fall within one of the following categories

A building or flat in which more than one single household shares an amenity – for example, a bathroom, toilet, or cooking facilities.
This is the most common type of HMO and applies to share houses for example student lets, professional lets.

  1. Tenants share one or more of the basic amenities or the accommodation lacks one or more of these amenities
    (defined as a toilet, personal washing facilities and cooking facilities) 
  2. The building does not entirely consist of self-contained units
  3. At least three people occupy the building who make up more than one single household

A property that has been converted and does not comprise self contained flats (doesn’t share amenities)

Self contained flats can be confirmed by the below

The property has a separate set of premises and all three amenities (Toilet, Washing facilities and cooking facilities) are the exclusive use of each individual occupant.

Alternatively if a block of flats does not meeting building regulation standard, and fewer than two thirds of the flats are owner occupied, this would be defined as a section 257 HMO, however this is much less common

What is a HMO mortgage?

The main difference between a HMO mortgage and a buy to let mortgage is that you can expect to net a much higher yield from a HMO, although there is a greater management level required to maintain a good quality HMO and the rent will normally be all inclusive of associated bills, water, gas, council tax etc.

Not all buy to let lenders will provide HMO mortgages, although in recent years the landscape of lenders has evolved and more lenders will consider smaller HMO’s depending on the type of tenancy in place.

How will my HMO be valued?

Most HMO mortgage lenders will value HMO’s of 6 or less rooms on a bricks and mortar valuation (a building valuation).

If your HMO is a fully operating HMO in an article 4 area, OR a large HMO or 7 or more tenants with “Sui Generis” planning permission, then we are able to obtain commercial funding based on the “going concern” of the HMO rather than just the building value enabling you to get a HMO mortgage against the income in addition to the building value.