HMO stands for House in Multiple Occupation and refers to a type of property rented to three or more tenants, from different households and share facilities such as the bathroom, kitchen, and common areas. This type of housing is becoming increasingly popular, particularly among students and young professionals, as it offers a cost-effective alternative to traditional rental properties. 

HMO housing are subject to specific HMO regulations and HMO licencing requirements, as set out by the local council. These regulations are designed to ensure that the property is safe, secure, and suitable for multiple tenants. HMO landlords must ensure that their properties meet certain standards and that they have the necessary licences in place.

As a HMO landlord, finding the right tenants is crucial for a smooth and successful tenancy. To ensure that you are selecting suitable tenants for your property, it is important to ask the right questions during the screening process. This article provides a comprehensive list of questions that HMO landlords should consider asking prospective tenants. By asking these questions, landlords can assess a tenant’s reliability, responsibility, and compatibility with their property and other tenants, ultimately leading to a positive and productive tenancy.

Questions HMO Landlord Should Ask Prospective Tenants

As a HMO landlord, it’s important to screen potential tenants to ensure that they are suitable for your HMO property. Here are an example of a few questions you should consider asking:

• What is Your Proposed Move-In Date?

Knowing this information can help the HMO landlord determine the void period, which is the time frame between the current tenant’s departure and the new tenant’s arrival. For instance, if the existing tenant is set to leave on the 15th of the month, and the new tenant is proposing to move in on the 1st of the following month, there will be a two-week void period.

By being aware of the void period in advance, the landlord can make adjustments to minimize the loss of rental income. If another prospective tenant is willing to move in the same day the previous tenant leaves, but is asking for a lower rent, the landlord must weigh the potential financial gain from the reduced void period against the lower rent offered.

Furthermore, knowing the expected move-in date also allows the HMO landlord to prepare the property for the new tenant, ensuring that it is clean, in good condition, and ready for them to move in on their expected date. By having this information, the HMO landlord can ensure a smooth and efficient transition for both the current and new tenants.

• Are You Willing to Provide Employer and Previous Landlord References?

Requesting references from a prospective tenant’s employer and former landlord can provide valuable information about their character and rental history. However, if a prospective tenant is reluctant or hesitant to provide these references, it may raise some red flags for the landlord.

For instance, if a prospective tenant outright refuses to provide references, it could indicate that they have something to hide, such as a history of late rent payments or causing damage to a property. In this case, the landlord may want to reconsider renting to this individual or require additional screening before making a decision.

If a prospective tenant agrees to provide references but seems nervous or hesitant, it may indicate that they are concerned about what the references may reveal about their history or the fact that they are actually not full time employed at all. 

In either case, if a prospective tenant is reluctant or hesitant to provide references, the landlord should take this as a warning sign and proceed with caution before renting to them. 

• What is Your Annual Income?

Knowing a prospective tenant’s annual income is crucial in determining their ability to pay rent and afford to live in the HMO. This information can help the landlord make a well-informed decision on whether the tenant can afford the rental payment, taking into account the cost of living and any other monthly expenses.

A common method of calculating a tenant’s rental affordability is to use the 30x rule, which states that their annual income should be 30 times the monthly rent. For example, if the monthly rent is £800, then the tenant’s annual pre-tax income should be £24,000.

• Do You Own Any Pets?

Knowing if a prospective tenant has a pet is important in determining whether they are a good fit for the HMO property and the other tenants living in the house. While some tenants may welcome a pet in the house, others may not for various reasons such as allergies, fear of animals, or simply a preference for a pet-free living environment.

Additionally, having a pet in the house can also cause added wear and tear, such as scratches on doors and furniture, pet hair on the carpets, and potential damage to the garden. This added maintenance can put a strain on the landlord and other tenants, who may not want to be responsible for repairing any damages caused by the pet.

In most cases, tenants moving into a HMO with a pet will not be accepted, as it may not be suitable for the other tenants and the property itself. However, it is important to keep in mind that laws regarding pet ownership may change in the future, and landlords may not be able to reject tenants solely based on their pet ownership. It is always best to keep up to date with the latest regulations and laws when making decisions about tenant acceptance.

• What is the Reason Behind Your Move?

It is essential to know the reasons behind a tenant’s move, as it gives insight into their past living experiences and whether they might bring any problems or conflicts to the HMO. For instance, if the tenant is moving due to issues with their previous landlord or property, it could be a red flag indicating potential difficulty in rent payment or maintaining good relationships with others. Additionally, if the prospective tenant starts complaining about their previous living situation or mentions a pressing need to move quickly, it may also raise concerns.

• What is Your Employment Status?

Determining the tenant’s employment status is crucial in evaluating their ability to consistently pay rent. This includes whether they are employed, on a contract, or undergoing probation.

Having a steady source of income and stability in their job is a strong indicator that they will be able to meet their rental obligations. On the other hand, if they are still in probation or on a temporary contract, there is a higher risk that their employment could end, leaving them unable to pay rent.

• How long have you worked in your current job?

This information can be a valuable indicator of the tenant’s stability and reliability. Generally, the longer the tenant has been employed in their current job, the more stable they may be considered, as they have demonstrated a commitment to their job and have likely built a stable income stream. This can provide reassurance to the landlord that the tenant is likely to have a steady and consistent income, increasing the likelihood of them being able to pay rent on time. Furthermore, it may also suggest that the tenant is responsible, dependable, and a good candidate for long-term tenancy.

• Do You Have the Funds to Cover to Pay the Deposit and First Month’s Rent?

It’s crucial to know if the tenant has the financial capability to pay the required security deposit and first month’s rent at the time of move-in. Knowing this in advance can ensure a smooth and stress-free move-in process. However, if a prospective tenant asks to pay the deposit in instalments, pay the deposit after they have moved in, or requests to pay no deposit at all, this may indicate financial instability may be a red flag. 

• What is most important to you about a houseshare?

By knowing what the prospective tenant is seeking in a houseshare, you can assess whether your property aligns with their needs and preferences. This information is valuable in determining the right fit for both the tenant and the property.

For example, if the tenant prioritizes peace and quiet, they may not be a suitable fit for a social Houseshare where residents interact and socialize regularly. On the other hand, if the tenant is seeking to make friends and is open to socializing, a Houseshare where residents keep to themselves may not be the best fit.

Also, importantly, understanding what your tenants value when they answer this question, such as fast internet speed, a large bathroom, shared facilities with a limited number of residents, or access to a garden, can help you better understand your target market.

• How long are you looking for a tenancy for?

If the tenant mentions that they plan to move out of the area within a brief span, for example six months, this can be inconvenient as you will need to re-let the room again soon. On the other hand, a tenant who says they are looking to stay long-term can bring about stability and predictability to your property.

• Do you have any questions?

Having an open dialogue with the tenant and encouraging them to ask questions can help to build rapport and provide valuable insight into their level of interest in your HMO. It also gives you the opportunity to address any concerns they may have and ensure they have a clear understanding of what living in your property entails. By taking the time to listen and respond to their questions, you can help establish a positive and productive relationship from the start.

• Other Considerations:

During the viewing process, it is important to trust your instincts. If a prospective tenant gives off a negative energy or seems to have a negative attitude, they may become problematic in the future. It is common for prospective tenants to put on their best behaviour during viewings, so if they are already being grumpy or complaining about things like the weather, traffic, politics, or their current living situation, it could be a warning sign.

It is important to note that shyness or social awkwardness is not necessarily a problem, but persistent negativity or anger should be taken as a red flag. Building rapport with the prospective tenant and engaging in an open dialogue can help you to gain a better understanding of their personality and determine if they will be a good fit for your property.

Conclusion

As a landlord of HMO housing, finding the right tenant is crucial for a smooth and successful tenancy. The key to identifying the best tenants is by asking the right questions. By asking the right questions, you can assess a tenant’s reliability, responsibility, and compatibility with your property and other tenants. This not only ensures that you have tenants who pay rent on time, but also tenants who maintain the property well and are pleasant to deal with when it comes to maintenance issues.

On the other hand, having a bad tenant who doesn’t fulfil their responsibilities can turn a landlord’s life into a living nightmare. It is therefore essential to prioritise asking the right questions during the tenant screening process to avoid any potential problems down the line. The benefits of asking the right questions are clear, as it allows you to choose tenants who are a good fit for your property and who will make your life as a landlord much easier.

If you are looking for a specialist HMO Letting Agent in South London who can let and manage your HMO, or if you need advice about anything HMO related, feel free to contact us.