Buy To Let property profile changes as landlords diversify

Buy To Let property profile changes as landlords diversify


Todays other news


Houses in Multiple Occupation are making up an increasing percentage of buy-to-let business, according specialist lender Shawbrook. 

In both 2022 and 2023, HMOs made up just over a quarter (27%) of all Shawbrook’s buy-to-let business. 

However, as landlords place further emphasis on diversifying portfolios, this number has already risen to more than a third (34%) in 2024. There has also been a rise in HMO business from non-portfolio landlords, from 17% to 21% over the same period.

Daryl Norkett, Director of Real Estate Proposition at Shawbrook, says: “As landlords have dealt with years of challenges stemming from the pandemic and culminating in the past couple of years of economic uncertainty, HMOs have proven to be a sound strategy for landlords looking to diversify their portfolios, as well as strong option for non-portfolio landlords entering the market.

“HMO rental yields are more easily able to afford mortgage lending in a higher interest rate environment, and the regular turnover of tenants allows landlords to stay on track with market rents.

“The option to reconfigure properties and the ability to turn lower yielding single lets into higher yielding HMOs has clearly been a strong draw over the past year or so, as landlords adjust their businesses to succeed in a tougher economic environment.

“We have already improved our HMO criteria to enable landlords to secure larger maximum loan sizes. And, whilst we have already seen a modest increase in HMO activity, once the predicted interest rate cuts finally arrive, we’d expect to see significant growth in this sector.”

Share this article ...

Join the conversation: Login and have your say

Want to comment on this story? Our focus is on providing a platform for you to share your insights and views and we welcome contributions. All comments are screened using specialist software and may be reviewed by our editorial team before publication. Letting Agent Today reserves the right to edit, withhold or delete comments that violate our guidelines, including those that harass, degrade, or intimidate others. Users who post such content may be banned from commenting.
By commenting, you agree to our Commenting Terms of Use.
2 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
Recommended for you
Related Articles
Andrews Property Group is under charitable ownership...
The supplier says half of its clients now use open...
Demand is roughly static but instructions from landlords are falling...
Two amendments are being put to the Renters Rights Bill...
The Welsh Government is backing the call for a 'compensation'...
There will be a greater emphasis on digitisation....
A consultation document is being released today....
Recommended for you
Latest Features
Andrews Property Group is under charitable ownership...
New tenancies in England and Wales are at their lowest...
The Scottish system would differ from the UK system in...
Sponsored Content
Tenants want a place they can call home—somewhere comfortable, safe,...
Letting agencies face the dual challenge of keeping both landlords...

Send to a friend

In order to send this article to a friend you must first login. Click on the button below to login or sign up.

No one likes pop-ups ...
But while you're here