Criteria for buying HMO property

What is HMO Property?

A property occupied by five or more people

• A property with five to seven lettable rooms in an area commensurate with multi letting

Properties subject to selective licensing are only classified as HMO where at least one of the above conditions are met.


• Minimum property value is £100,000

• Maximum 75% LTV. See our table for maximum loan amount per property.

• Landlord experience: at least 2 years as a standard BTL landlord or 1 year as a HMO landlord

• Let to Buy applications not accepted

• For valuation purposes, rental cover will be assessed on a multi-tenanted basis

• All let properties will be subject to an Assured Shorthold Tenancy agreement, or either a Short-Assured Tenancy agreement or Private Residential Tenancy Agreement in Scotland of a minimum of 6 months, maximum of 36 months (except if the tenancy is a Private Residential Tenancy (Scotland only) where there is no maximum). Single and multiple tenancy agreements accepted

• A property must have no more than four habitable storeys and no more than one kitchen

• Properties consisting of more than one self-contained unit under a single title are not acceptable

• The property must offer a communal seating area

• A Specialist Security valuation will be required

*Please note that the status of a property as an HMO will be determined by the valuer.


• For all HMO applications, including Further Advances, a Specialist Security valuation will be required

• The valuation fee is payable by the customer at application on all HMO applications

• Before a valuation can be carried out, we'll require a copy of the HMO licence. This will be requested by the valuer and must be in receipt prior to a valuation being booked.

Where a license has been requested but not received within 15 working days, the valuation AND application will be cancelled.

MSR Group

MSR House, Ley Street, Ilford, Essex IG1 4AA

T: 020 8514 2678 | F : 020 8514 6963

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