Precise Mortgages has revealed that HMO landlords are currently achieving average rental yields of 6.3% — compared with the market average of 5.5% — while average rental yields across the market are at their lowest for nine years.

Average yields for all property types dropped by 0.3% in Q2 2019 from 5.8% in Q1 2019 and are now at their lowest level since 2010.

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Other highlights included:

• 50% of landlords planned to buy a terraced property, however, 40% also planned to sell terraced properties in the year ahead
• only 8% of those holding HMOs in their portfolios planned to sell them
• 8% also planned to buy blocks of flats, while just 5% aimed to divest
   

Alan Cleary, managing director at Precise Mortgages (pictured above), said: “In a time of market uncertainty, HMOs are an attractive option for professional landlords looking to maximise yields.

“The expansion of the HMO sector underlines how experienced landlords are rebalancing their portfolios.”