As property prices increase, first time buyers are also getting older. 5 years ago, it was common for a sub-30 year old to purchase a property. However, because of the current house price/income ratio, its uncommon for anyone below the age of 30 to be able to afford a decent property without raising a huge deposit.
Therefore, people are forced to rent. Those that can afford to, will rent out a single bedroom flat. Otherwise, it is more common for groups of friends to live together in 2+ bedroom houses and flats.
A tenant will often think to himself, why pay 700 pound per month on a mortgage when you can rent a single room from 200 pound per month depending on where you live. This has created a huge demand for HMO landlords who need to fill rooms in their multi-let properties.
The type of people that would want to live in such accommodation include, but are not limited to:
-Students
-Nurses
-Doctors
-IT contractors
-Shop workers
-Airport workers
-Newly qualified graduates
-Asylum Seekers
-Housing Benefit tenants
-Recently divorced tenants
-Foreign (non-uk) citizens
-Etc.
In fact anyone, who enjoys living with other people. I get several calls a day from the above types of potential tenant looking for individual rooms to let in a property.
So if you are looking to purchase an investment property to let out to sharers it may be worthwhile to determine where these sorts of people would like to live. Once you have shortlisted several such areas, you can focus your efforts accordingly.
You would normally source a property for multi let usage using similar techniques to those you would use for single let properties. If you are ever unsure of the rentability of your house, it is advisable to place adverts in the local paper and to gauge response. A couple of calls in a 1-2 week period would indicate a low demand and hence you should stay clear of such locations.
As always, dictate the market conditions before you buy property. You are buying property to run as a serious business. A property purchased in an un-lettable location is not the best use of ones resources and could result in you quickly losing your business.
