Those of you who have been following my HMO journey since the beginning of 2020 will know that it’s certainly not all been plain sailing, despite the incredible success we’ve had with our first property.
When I last wrote early in December, we’d just had an offer accepted on a property that was due to become our second HMO.
It was a fantastic property, with huge scope for development as well as making a fantastic HMO.
At that point, conveyancing was due to start and it was that process that, ultimately, flagged up a significant problem.
The bouncebackability effect
Pretty much exactly a year on from losing a property that would have become our first HMO, this time it was our turn to pull out.
The property we were buying was an ex-local authority house and early in the conveyancing process, our Power Team solicitor discovered a covenant that would have placed severe restrictions on our plans for the property.
We ran through our options, both as a family and with our buying mentor Mike Dixon, and as we couldn’t do what we’d planned to make our numbers work, we had no choice but to pull out of the purchase.
If the situation taught me one thing, it was that you can’t turn any property into an HMO and having the right people around us to help us make the right decision on this one was crucial.
I was sad for us, but equally sad for the vendor, who through no fault of their own was now back to square one themselves.
A collapsed deal is never a nice experience for anyone, but it’s a fact of life in property and it’s how you bounce back that really matters.
And just as we’d done back in 2020 when the purchase of our first property fell through, the following day we were back on the horse.
Thinking outside of the box
The market was pretty slow in January and February although once the stamp duty extension was confirmed in March, things heated up a little bit and properties were selling quite quickly.
There were a couple of options we looked at online but by the time we had made contact with the agents, they’d sold.
I knew I was going to need to start thinking a little more outside of the box if we were really going to get moving with the second property – which is what we were striving to do.
But the property we’ve ended up buying, I have to admit, took me by surprise…
Bournemouth Road is a lively thoroughfare between Bournemouth and Poole, is a popular location for young professionals and not far from where our first HMO is located.
It’s home to a variety of residential homes mixed in with rows of shops – and one of those shops, we hope, is going to become our second HMO.
The lure of a genuine challenge
The property caught my eye right away and certainly fitted into that mould of ‘thinking outside of the box’.
I should add at this juncture that pursuing a commercial property with a view to converting it into an HMO isn’t for the faint of heart and isn’t what Platinum would recommend for a Franchise Partner with just one property to their name.
But we love a challenge, and we simply couldn’t walk away from the potential this particular property offers.
It’s an old photography studio on the ground floor with a residential flat on the top floor and has lovely high ceilings and a vast amount of space, as well as being in an amazing location.
Not only that, but the vendor also inherited the property and wanted to sell quickly, so we brought it in well under the asking price.
All good news – but I’ll forgive you for asking ‘why?’ when I reveal that we’re only planning to do a five-bedroom HMO with this property, rather than six.
Here’s why…
Creating a home that works for work
Before I started this journey, my assumption was that the two things housemates were most concerned with was the size of their room and whether or not it had an en-suite.
But I learned a lot from our first property, which has six bedrooms of varying sizes and varying monthly rents.
I learned that modern HMO tenants want space and ample storage.
But I also learned that they also care deeply about who they’re sharing a home with.
And that has only been heightened by the lockdown – after all, if you’re going to be spending so much more time at home, it makes sense to place more emphasis on who else is sharing that space, doesn’t it?
The six guys in the first property are all like-minded and get on really well, so we learned a lot about getting that right from the first house and spent real time looking to create a good blend.
To be honest, I think my husband John sometimes thinks it would be more fun for him to go and live in the first property with those guys and leave me and the kids to it at home!
I think we got the make-up of our first property pretty much spot on, both in terms of the housemates who live there and the layout they spend so much time utilising.
But we want to take things further with this second property.
We want to create a larger communal area, twice the size of the one in our first property, and this will include a large, shared working area – almost a co-working space within a home.
Thankfully, we’re now on the right track with the loosening of the lockdown, but I really believe many businesses in my area will maintain a level of flexibility for their workforces.
My gut feeling is many will operate a ‘three days in, two days at home’ working week, which is what we’re considering for our team here at Platinum.
I work from my bedroom when I’m working from home and I’ll be honest – after a certain amount of time, I get a bit fed up.
That’s not what I want for my housemates and that’s why we’re looking to create this area where housemates can work, so they have that separation between ‘work’ and ‘home’ even though they’re still in the house.
Back to those bedrooms
To facilitate this larger communal space, we want to back that up with more consistent bedroom sizes – and that’s why five bedrooms will work better than six in this particular property.
It kind of goes against what Platinum advocates, but we really believe if we make it a five-bedroom HMO, it will be five great bedrooms rather than six good rooms.
That should mean that the housemates stay longer as they’ll have more bedroom space and we’ll be able to create that dream communal space, too.
The planning conundrum
If I’m being honest, it’s probably a bit soon for us to be taking on a commercial to residential project.
But that’s the confidence you get from doing what we’re doing through a franchise like Platinum.
As you can imagine, there’s a whole new level of complexity when it comes to turning a commercial property into a shared living HMO and I wouldn’t have minded at all if the experts at Platinum had turned around and said we were mad.
But, of course, they didn’t.
When I called Mahsa from our planning team, she was hugely supportive. She acknowledged that we were very inexperienced to be taking on a commercial to residential conversion given we’ve only done one HMO, but she agreed it was a great property.
We know, having spoken to Mahsa at length, that there are risks and there are additional costs involved with what we’re doing – and we’ve put a Plan B and Plan C in place should things not work out how we hope they will.
Mahsa is working with us on completing two planning applications – firstly to convert it from a commercial property to a C3 residential property, then, through a separate application, from a C3 to a C4, which is an HMO – as this gives us the best chance of approval.
For the first stage of that, we’re confident as the shop next door has already converted from commercial to residential C3 class, so there’s a precedent there.
And with the second stage, we may be able to go from C3 to C4 under permitted development, which is what we did with the first property.
There are lots of unanswered questions, but with Mahsa backing us, I know we’re in the best possible hands when it comes to these more complicated planning issues.
The reliance we have on Mahsa for this project really brings home the fact that there’s no way we’d be doing it without Platinum.
When I write again, I’ll have news on our first planning application, and I hope to be able to include an update on our plans for what we hope will become a very special HMO.
In the meantime, continue to stay safe and fingers crossed for an incredible summer.
