The launch of the new products follows feedback from brokers who suggest that more enquiries are coming from first-time landlords who are attracted by higher yields from HMOs.
The lenders’ new products are available for HMOs with up to six bedrooms and include new build property. A two-year fixed rate is set at 3.49% and the five-year fix starts at 3.79%, both available up to 70% LTV with a 1.5% fee.
Paul Brett, Landbay’s managing director of intermediaries (pictured), commented: “Landlords are becoming more sophisticated and they understand the responsibilities of managing an HMO. They have done their homework and know the yields on HMOs are much higher than single flats or houses resulting in greater financial rewards.
“There is also more demand for living in HMOs, particularly from young professionals who want or need to share a house. Some simply can’t afford to rent their own place but many actually like communal living. Much of the HMO accommodation is far better quality than it used to be and can demand a higher rent.”
