The Secret Sauce to Creating HMOs in Article 4 Areas

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Choosing the right location for an HMO is crucial.

You need primary locations where tenant demand is strong.

But these are often in Article 4 areas. Most are overpriced.

In this episode, we reveal the secret sauce to getting an HMO in an Article 4 area.

Tristan Gordon of Zebra Invest is the perfect person to talk about HMOs.  

He helps landlords navigate the complexities of regulations through his company HMO Compliant

We discuss:

1. HMO Locations: The importance of selecting strong-demand locations for HMOs, often in Article 4 areas where supply is limited and values are higher.
2. Article 4: a planning regulation adopted by councils to control HMO conversions in certain areas.
3. HMO Demand/Supply Imbalance: Operating within Article 4 areas can be lucrative due to lower competition, despite higher perceived barriers.
4. The 10% Rule
5. HMO Registers vs Planning
6. Grandfather Rights & Lawful Development Certificates (CLUs) to prove continuous HMO use and get planning.
7. Gathering Evidence for CLUs: Tenancy agreements, rental income proof / letting agent records / electoral rolls / sworn affidavits.
8. Dangers of Unproven HMOs: Buying HMOs without proper planning = fewer mortgage options / lower value.
9. Direct to Vendor Marketing: Handwritten leaflets / targeted data analysis / timing
10. Use of Data Tools: Combining EPC / sales data / HMO registers to find sellers.
11. "Sandwiching":  restriction of properties adjacent to existing HMOs 
12. Certificates of Lawful Use (Existing & Proposed): for regularising historic use and for establishing intended use, for selling / refinancing.
13. Incremental HMO Planning: Increasing HMO sizes step by step e.g. from 6 to 7+ beds) 
14. Detective skills:  Public records, planning portals,  Trace Genie — persistence and smart data gathering can give you an edge.

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