As we have been reporting recentlyin this magazine, the shared accommodation sector, comprising of HMO’s and Co-Living units is currently experiencing challenges that property investors and landlords do need to consider carefully. The recent pandemic exposed some operators’ business models as many tenants chose to exit their city-centre room lets and return to their family homes, while many went back to countries within the EU and elsewhere but have not returned to the UK.

Just two years ago, the portal Spareroom highlighted a 34% decrease in room rents in some boroughs within inner London. Thankfully, we seem to be over that very difficult period with Covid, and city centre living across the UK has rebounded although office-working patterns have changed for many. This August, the latest data from Spareroom shows a 15% increase in average room rents across the capital.

With the cost-of-living burden affecting many people, it is no surprise that with belts being tightened, tenants are looking to reduce their accommodation costs by renting a room rather than paying out even more for a one-bed flat. As such, some operators around the UK, particularly those with high quality property, are now seeing record demand for rooms, added to of late by the start of the academic year.    

I recently spoke with Manni and Romey Chopra who are portfolio landlords and developers and to learn more about their latest HMO project in Maidenhead. We last heard from them almost three years ago in the ‘pre-Covid’ era so I was pleased to hear that despite the inevitable challenges of late they have continued to expand their operations.

“We first looked at this property in May 2021,” said Manni, “and it was a 3-bed on a corner plot, semi-detached house but in very poor condition and which had been occupied by squatters. There was a lot of interest from potential buyers and the asking price was £400,000 for which we agreed to pay effectively as a cash purchase, and thankfully we had our offer accepted. We exchanged and completed on the same day as there was an urgency to complete at the time, due to the expiry of the SDLT ‘holiday’ in June 2021, but we still had to pay the 3% additional SDLT charge.

“Once we had got access, we immediately boarded up the property, stripped it out internally and sought planning permission for the double-storey extension. We obviously realised this was one of those where the works required were significant and internally we had to strip it all out ‘back to brick’. Romey prefers these as he seems to like doing the on-site ‘mucky work’ and that suits me!