New HMO guidelines could hit student pockets
Implementation of government guidelines meaning extra costs for existing landlords could result in an unforeseen increase in student rents, experts at Cullen Property have warned.
The government’s HMO (Houses of Multiple Occupancy) guidelines recently implemented by The City of Edinburgh Council state that all properties above 7.5 metres must have a secondary fire escape and, if not, a suitable alternative means of providing safe escape. This will often mean the installation of a sprinkler or mist system on one or both levels and typically costs will exceed £6,000.
The extra costs involved could see some landlords exit the property market, with remaining landlords upping rents as a result.
Malcolm Warrack, MD of Edinburgh-based Cullen Property, says: “Licensing of double upper flats, a type of four and five bedroom flats popular with students, for Houses in Multiple Occupation (HMO) purposes will have greater costs and, as a result, some landlords will consider the imposition too expensive and come out of the market.
“Remaining landlords will then be able to charge higher rents for compliant flats in light of the reducing numbers of suitably sized flats available. The resulting increased student rents could have a serious long-term impact on attracting students to the city.”
“Edinburgh student rents continue to see annual increases against a trend for other properties, where rental levels have either fallen or remained static, a result of the 12% increase in university applications for 2010-2011, so opportunities for existing landlords or potential student property investors are significant. However excessive rents, plus a lack of suitable property for students, could result in a student property shortfall next year and beyond.”
Cullen Property specialises in letting, acquiring and managing properties for clients looking to invest in and let residential property to both the student and professional markets in Edinburgh.
For further information visit: cullenproperty.com