Single Let vs Multi Let

A question I often get asked is “why are you focussing on Multi-letting?”. The answer is short and sweet, more cash flow!

Lets take a typical single let property, say a 3 bedroom house, and look at this from both angles.

So here we can see we’ve added an extra £200 to the income this property generates, even taking all extra costs into account. All this for having two more tenants. Lets bear in mind this is the same property, so there’s only a few areas where this will be a little more hassle to manage. Mostly just in relation to the tenants getting on together, and having more people to collect the rent from. After all if the boiler goes, or the toilet floods, you’ll be getting a call in each situation. A lot of the time we’re very wary of the extra effort of managing a few more people. Its amazing how we can put in all the effort to find a good property, spend the time refurbishing it, but at the last hurdle take the easy route out.

 

3 Bedroom House

4 Bedroom House

Letting

Single Let

Multi Let

Single Let

Multi Let

Rental Income

£1000

£1500

£1200

£2000

Mortgage

£500

£500

£500

£500

Costs

£150

£450

£150

£500

Tenants

1

3

1

4

Net Cash flow

£350

£550

£550

£1000

Hassle Factor

Low

Moderate

Low

Moderate

 

Now three rooms is generally the smallest you would tend to multi let with, but some two bedroom properties may still work. So lets see what happens when we start to increase the size of the property a little, and add a 4th room. On your typical single let that may give you an additional £200-250, but in a multi let an extra £450-500. This keeps going on and on the more rooms the property has, the extra cost for an extra room thats multi let is pretty minimal once you have the property as a multi let.

Its far easier than you think to change your property over to a multi let, all it requires is a quick call to your local council to clarify what the regulations are around HMO’s.

This is a simple and effective way to boost you cash flow from properties.

 To your success

2 Responses to “Single Let vs Multi Let”

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  1. chandresh says:

    ig your are multi-letting a property which does not need a HMO License, then are there any regulations be it building or health and safeft or fire which you need to comply with?

    • Paul says:

      Yes, even if it doesn’t require a license, if you are multi-letting the property it will be classes as an unlicensed HMO, with all the fire safety, and other safety implications. A lot of councils use the LACORs guide which shows the fire safety requirements. Though I would recommend e-mailing your local HMO officer to find the exact requirements.

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