One of the first properties I stumbled across this morning is this 3 bed semi-detached property being marketed by the guys at Open House.
One quick look at the floor plan and I thought ‘hmmm this might work as an HMO.’ Here are the key contributing factors…..
– 3 Bedrooms upstairs, 3 separate areas downstairs meaning 2 more bedrooms plus a small communal area.
– 2 bathrooms (Caveat – the description doesn’t mention the second bathroom so I’m assuming the plans area correct
– Proximity to town, existing met-line and new met-line when it finally opens.
Potential HMO in Watford
As always with HMO’s if you are considering this it may be worth getting the fire officer round to have a look and confirm you can convert this property.  Although it doesn’t fall under mandatory licensing regs there may be some other issues which stop you being able to use it as a 5 bed property.
If however you can use it as a 5 bed property you would be looking at an average of £600+ per room so a total potential rental income of £3000 per month. That would give you a gross yield of 8%. Don’t get too excited too quickly though. In this kind of house share it’s like you would need to pay for the council tax and bills which might come to around £500 which drops your yield down to 6.6%.
If you’re keen to run HMO’s in Watford then this might be one for you.  The yield is not amazing for a HMO.  You have to go bigger (i.e. more rooms) or potentially further out from London to achieve higher yields.
There is still good potential for growth here though so you might find this property gives you a pleasant balance between the yield/capital growth.