New mortgages launched for landlords attracted to higher yield HMOs  

 

The HMO mortgage sector is steadily growing as lenders launch new products in response to the increasing number of landlords turning to this specialist area.  

Data from Leeds Building Society reveals that houses in multiple occupation (HMOs) offer the highest yields of all types of rental properties. Average returns are 6.9%, as opposed to 5.8% for other property rental types. 

Leeds launched a range of mortgages tailored to small and large HMOs earlier this year, in response to landlords increasingly moving into this rental sector as they diversify their portfolios and look for alternatives to the traditional buy-to-let business model.  

Saffron launch four new mortgages 

Saffron Building Society has added four new products to their specialist mortgage range specifically targeting HMO landlords.  

The societies small HMO buy-to-let products (3.37% fixed until 31.10.2021, 75% LTV (two-year) and Light Refurb: 3.64% (SVR 2.0%), three-year discount, 75% LTV) are aimed at experienced buy-to-let investors purchasing their first HMO with up to four tenants, adding to an existing portfolio or remortgaging an existing HMO.  

They have also launched two ‘large HMO’ products 3.67% fixed until 31.10.2021, 65% LTV (two-year) and Light Refurb: 3.94% (SVR 1.7%), three-year discount, 65% LTV for HMOs with up to six tenants. 

Fleet Mortgages add two and five-year fixed mortgages to range  

A two-year fix at 4.39% and a five-year fixed rate offer at 4.49% both with 80% LTV, have been added to Fleet Mortgages HMO range.  Steve Cox, Distribution Director, said: 

“Professional and portfolio landlords are increasingly looking to add to portfolios via limited companies and are seeking to purchase both HMOs and MUBs in order to access greater levels of rental yield Fleet. However,  many borrowers’ own properties in their individual names and will continue to so…, which is why we were keen to ensure these 80 per cent LTV products were available...” 

Keystone cuts rates by 0.21% 

Keystone has cut its rates on their specialist range. Their five-year fixed 75% LTV has dropped from, 3.95% to 3.74 %, with a maximum loan value of £1m. Available to landlords of HMOs and multi-unit properties individually or as a limited company.  

Helping landlords maximise their rental yield with a range of new and improved HMO mortgage products is a strategic move by lenders competing in a tougher marketplace as landlords begin to feel the sting of regulation changes. However, HMOs may not be the only new focus for landlords; the Leeds study also found that multi-unit blocks (MUBs) of flats are offering an average yield of 6.3%.

 

Highgrove Mews

High Net Yield Freehold Houses

  • Commutable to London (27 mins to central Paddington station)
  • Rental demand extremely strong with large industry presence in Reading
  • Freehold with 4% net yield

£284,955 - £457,000

St Petersgate – Stockport Manchester

New Launch - Stockport Manchester, apartments from £160,000

  • Discounted launch prices from £160,000
  • Excellent transport links with 3 trains per hour to London Euston and only 9 mins journey to Manchester Piccadilly
  • Experienced development team

Assured Rent Housing Association Leases

Assured Rent Housing Association Leases

  • Assured rent & no rental voids
  • Tenant damage cover & newly refurbished inline with requirements of a corporate sitting tenant
  • Free property and lettings management

From £62,000

Emerging Birmingham Commuter Town With Properties From Just £104,000

The emerging Birmingham commuter town where properties are selling in an average of just 24 days

  • A collection of 62 two bedroom apartments and 28 one bedroom apartments.
  • DE14 is one of the fastest selling postcodes in the West Midlands.
  • 23 minute train journey into Birmingham New Street Station.

Properties from £104,000

Mill, Stockport

The Northwest's emerging property hotspot

  • Discounted off-plan 2-bed prices from £162,000
  • Completion date - Q4 2021
  • Rental yields - 6% plus

Discounted off-plan 2-bed prices from £162,000

South Central – Birmingham City Centre Apartments

Highly anticipated 28 storey launch in Birmingham City Centre with an impressive roof garden and communal facilities.

  • 154 units across 28 storeys
  • Residential multi-media community room, gym, roof garden and sky cinema
  • Excellent future connectivity via the metro system to other key transport hubs and locations around the city

from £205,800

ba-

Talk to us

Speak to our UK property experts today: 

+44 (0) 333 123 0320

Open from 9am-6pm GMT

+852 9865 4446

Open from 9am-6pm HKT

Stamp Duty Calculator

.

Unlock members only investment opportunities and full development details. Join now – it’s free, quick and easy.

Login

Not a member? Sign up for free

British mortgage lending rates reach lowest rates ever

New mortgages launched for landlords attracted to higher yield HMOs  

Example

By submitting your details via this online form you agree to be contacted via email/phone/SMS by Direct Marketplace Ltd t/a BuyAssociation in relation to property investment and property developments . We do not share your personal details with third parties.  To view our full Privacy Policy click here.