Editor's note: This brief was summarised by The Property AI Team from a report by Property118. Read the original article for full details.
Existing HMOs UnderCut Purchase and Conversion Costs by £191k
Landlords weighing up an HMO investment face a £191,618 gap between the average asking price of an existing licensed property and the estimated cost of buying and converting one, according to research by Rushbrook. The findings suggest existing licensed HMOs are priced well below the purchase-and-convert route.
Rushbrook puts the average asking price of an existing licensed HMO in England at £340,264. The estimated cost of buying a property and converting it into an HMO stands at £531,882.
That £191,618 difference is the premium a landlord would pay by converting rather than acquiring an already licensed HMO. For letting agents and inventory clerks in the HMO sector, the figures point to a notable pricing dynamic between the two acquisition routes.
The research covers England and compares average asking prices for existing licensed HMOs with estimated purchase and conversion costs. The source report gave no further breakdown by region, property size, or timeframe.
Source: Property118