We speak to Jim Haliburton of HMO Daddy fame to find out about HMO property yields, current property hotspots and discover his top tips for building a property empire.

What is your company name?
J9 Accommodation and HMO Daddy Training Ltd.

What do you specialise in?
Running HMOs and training people how to become successful HMO landlords.

Describe your property/investment credentials?
Self-made, I learnt the HMO business the hard way.

When did you first become interested in property?
Probably in 1971 but I did not buy my first property until 1991.

Why were you specifically attracted to property?
The awesome returns and the opportunity to become financially independent.

Do you always buy a similar type of property when adding to your portfolio?
Initially yes, but I am now looking to do larger deals.

How do you decide on what properties to buy for HMOs?
I simply do the arithmetic. Does the income and cost allow me to recover all of the expenditure on remortgaging?

Do you have a good team of people behind you? Which staff couldn’t you function without?
The simple answer is all of them. If I could function without them I would not be employing them. Staff and contractors are the most difficult part of this whole business. Nothing prepares you for the challenges they present.

How do yields differ between HMO and buy-to-let properties?
If you do it right, you get a much higher return from an HMO than a buy-to-let property. The traditional view is that HMOs are much harder to set up and run. This is not the case, if you know what you are doing, a six-bedroom HMO is no harder to run than having six buy-to-lets. And a six-bedroom HMO is likely to achieve up to six times the return of one buy-to-let.

Where are the best UK property hotspots at the moment?
I am extremely fortunate that my ‘hotspot’ is local to where I live in Wednesbury. It is difficult for me to comment on other areas as I do not invest anywhere else. London has consistent price rises. I wish I had invested in London, but I stayed away as I was told that it was ‘overpriced’ - that was in 1971! Will London prices keep rising? Quite possibly.

In Your Property Network Magazine there is a UK Flatshare Index that details the annual change in rent prices seen in different locations. Dundee has seen an increase of 30.3%, Milton Keynes 19.3% and Wirral an 11.2% increase. Maybe these could be the new ‘hotspots’… or maybe they have peaked.

What are the benefits of owning so many HMOs?
The obvious one is the financial return I achieve, however it is not all about money. I don’t want to just be the richest man in the graveyard. In my area and with my strategy I believe one of the biggest benefits to me is that I can give back to my community by offering affordable accommodation for the more vulnerable members of our community. Often the perception of vulnerable people is wrong. My HMO business houses these individuals and my training business educates other investors how they too can cater for these people whilst also building a successful business at the same time.

What are the drawbacks of owning so many HMOs?
There are not many drawbacks once you learn to manage staff. I love what I do!

Who is your best type of tenant?
The very best tenants are often more mature tenants, those who stay for longer periods of time. They pay their rent without delay and look after the property they are in. They're the ones who cause me no problems.

Who is your worse type of tenant?
Those who destroy my HMO. They tend not to pay their rent and often cause so many problems that they become an absolute nightmare.

Best piece of advice you’ve ever been given?
To always ask, “What is the person giving the advice getting out of this?”.

Worst piece of advice you’ve ever been given?
Where do I start? I have had so much it is almost impossible to determine the worst. The advice not to invest in London all those years ago is probably one of the worst. I wonder how different my life would be now if I had.

What are your top five tips for anyone thinking of building a HMO property portfolio?
Create a strategy and do it
Act quickly
Hold, do not sell
Keep it local
Remember your goal

For more details on the above points, take a look at my blog post, ‘Twelve Top Tips for Newbie Investors.’

Do you think the property business is harder today than it was 10 years ago?
Yes, and no.

Why do you think this is?
There is so much more advice and help but if you are not careful you end up with ‘analysis paralysis’. Now there are lots of training courses available to teach you what to do and how to do it. However, this makes it harder to just get on and do it as there is so much advice often people forget to actually take action.

What is your proudest achievement, either in your personal or professional life?
My children.

Where do you see your business in five years’ time?
Depends which side of the bed I get out of. There are so many black clouds out there. I take hope that I have also lived through so many black clouds and they have amounted to nothing. My ambition for the training business is to help people make a difference to their futures. It is simple but it's not easy. I want to be the bridge to their success.

Who or what is your inspiration?
No one, though Mandela and Branson are two names that spring to mind. There are so many inspirational people out there but, they are also human.  

How do you relax?
Work until I drop. I must love it.

Five words that best describe you?
I leave that to others.

Where would you choose to live if you could live anywhere in the world?
I don’t know, if I did I would be there.

What three things couldn’t you live without in your home?
Family, cat and dog - they are what make it a home.

For more insights about HMO investment, training courses and Jim Haliburton's property strategy, visit his website here.