The total cost of an HMO investment in Edinburgh
How much will you have to spend on an HMO?
One of the most frequent questions from prospective landlords or property investors is: ‘How much does it cost to get an HMO licence in Edinburgh?’ And obviously, landlords and investors are not just asking about the licence fee! Edinburgh Council’s Houses of Multiple Occupancy (HMO) fee is only a small part of the overall cost of converting a regular 3 or 4 bedroom flat into a fully-fledged HMO investment property.
Edinburgh Letting Centre is an HMO specialist letting agent based in Edinburgh, Bruntsfield, and we have created a template for potential landlords to help them to obtain a rough estimate of all costs. Please remember that all costs are approximate and do not constitute a quotation: different contractors may charge different fees, some jobs are easier to do and some may turn out more expensive. Some properties may require only simple upgrades (like installing door closers), but upgrading non-compliant flats up to HMO standards will cost significantly more.
There are three main categories of HMO related expenses: Cost of remedial works and upgrades necessary to obtain a licence.
- Cost of remedial works and upgrades necessary to obtain a licence.
- Cost of safety certificates.
- HMO licence fee.
- Ground floor flats can have hardwood flooring, as there are no neighbours living below to complain about excessive sound.
- If occupiers (tenants or live-in landlords) sign a noise declaration form, available on Edinburgh Council website. The document states that the current flooring of the flat above is satisfactory, dampens all noise sufficiently and that the neighbours do not need the property above to be carpeted.
So, depending on your current flooring and the neighbours’ willingness to sign a noise exemption document (they actually usually do sign it), the cost varies from 0 (best case scenario) to around £3,000 (good quality carpets, vinyls and underlay, labour, removal of old flooring).
- EPC, Energy Performance Certificate
- EICR, Electrical Installation Condition Report
- PAT, Portable Appliance Test
- Gas Safety Certificates (only if there are gas appliances in the property)
- LRA, Legionella Risk Assessment
HMO properties will also require following certificates:
- Fire Risk Assessment
- Fire/Smoke Alarms Test Certificate
- Fire Fighting Equipment Test Certificate
- Emergency Lighting Certificate (only in properties with emergency lights)
- Sprinkler Test Certificate (only with properties with sprinklers)