I was contacted the other day by a property investor looking to expand his portfolio, who wanted advice on the “best” type of tenant for HMOs.
We talked over the options and I pointed how there are essentially a few demographics that people tend to look to in Medway – students, young professionals and key workers.
Medway’s local universities bring a large student population, and there is of course an expanding stream of professionals who are looking to the Towns to escape the astronomical prices of London, while still being in reach of the capital. This is well established.
But, as I explained to the investor, there is another type of tenant that lots of people overlook when it comes to HMO and BTL, and that is contractors.
Now, what do you think of when you hear the word ‘contractor’? Did you immediately think construction worker? You wouldn’t be alone. While construction makes up a huge chunk of the contractual worker market, there’s more to consider.
Beyond construction there are contractors from engineering fields: environmental, mechanical and electrical. Also think to the people who work in IT, aviation and marine industries, health, education and agriculture. What links all of these people is the need for short- to medium-term accommodation.
And it’s a sizeable market that will only expand. ONS stats from 2015 found that there are 1.2 million people working for private contractors in the construction industry alone – and of course much of this will be concentrated in London and the south east.
Once my investor contact considered Medway’s health, education and engineering infrastructures too, the whole thing started to look quite promising.
But still, why wouldn’t he go after the students with their large grants? I explained that contractors will often have a better stream of income – often well above national average – and, let’s face it, they will likely pose fewer problems nuisance-wise than students.
It’s certainly a fluctuating market that is not without risk, but with Medway and Kent being so well poised with multiple industries within close reach, there are certainly lots of opportunities in the contractor-tenant market.
OK. So contractors are a great choice. How to go about finding them?
Contractors are often dealt out by agencies who find them work on local projects and companies. Getting in touch with local agencies and establishing a relationship is a great way to initiate a stream of workers who can use your HMO or BTL property for their accommodation needs. The agency can house their workers and profits can come your way. Win win.
I have personally helped a number of landlords establish these relationships with my contacts, which took away some of legwork of contacting the companies personally.
If housing contractors in one of your properties is something you are interested in, or you have any other queries, you can drop me an email at firstname.lastname@example.org or ring me on 07944 726676.
Corporation Street development to knock down existing homes
While you’re here, I thought I’d update you on what’s going with a development on Corporation Street that you have may have spotted getting further underway.
A number of mhs homes adjacent to Rochester station, opposite the Blue Boar car park on the high street, are being demolished and replaced with a new development of two five-storey flat blocks.
The construction work is being done by Chartway and will create 89 new plots, made up of 53 shared ownership flats and 36 market rent homes – all with parking spaces.
Being right next to the station with its quick links to London, people will surely be keen to secure what is promised to be affordable properties in the new development.
Ashley Hook, mhs homes’ CEO, said: “This vital development will help meet the diverse housing needs of the county and contribute to the regeneration of homes in Rochester.
“In Medway, house prices are almost eight times the average salary making home ownership unaffordable for many.
“We’re committed to building homes in places where they’re most needed and contribute to meeting the housing need in Kent.”