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As HMO landlords, it’s really important that we deal with maintenance swiftly and efficiently, keep our tenants happy, and prevent anything from worsening that could ultimately cost us a lot more in our HMO properties.
Maintenance is an essential part of running a property business, especially a HMO business. But it’s easy for these costs to spiral. So, how can we reduce our maintenance costs, particularly in the current cost-of-living crisis?
No matter where you are in the country, the types of tenants you have, or the age and size of your HMO properties, there are things that you can do to reduce the costs of your maintenance. Read below or listen to the full episode on The HMO Podcast for five things to implement into your HMO business to help reduce your maintenance costs and boost your profits!
1. Create a clear maintenance policy.
Having a written maintenance policy isn’t just for you. It’s also helpful for any staff or team members that you have or might have in the future, in addition to your tenants. This helps set and manage expectations, particularly as rushing around to get non-urgent items done quickly will cost you more money.
When tenants raise an issue, it may need further investigation, you may need to watch and wait and do a bit of trial and error, and other times you’ll need to get specialists involved. Having a maintenance policy means your team and customers understand what to expect and what resolution timeframes you work within, particularly as not everything is urgent.
Emergency and urgent items obviously need to be done quickly because they’ll have an effect on your tenants, but some things just don’t. And by having these expectations set from the outset, you take some of the pressure off yourself and buy yourself time to get the right people in, shop around for the right materials, and figure out if it’s a genuine problem!
2. Use a team of trusted tradespeople and negotiate labour rates.
It’s really important to have good relationships with a range of tradespeople. Sometimes it’s difficult to build trusted relationships in every trade but have those relationships in place wherever possible.
And have pre-determined labour rates that you’ve already agreed to in writing so that you know what to expect when you call them out. It’s really important that you keep on top of this, particularly if you’re dealing with maintenance across a larger HMO portfolio. This will really help you avoid receiving extortionate fees and invoices!
3. Batch your maintenance jobs.
If you have properties that are next to each other or one property that has multiple low-grade, non-urgent items, batch these maintenance jobs wherever you can. This can help you significantly reduce maintenance costs as you won’t pay that premium for a tradesperson to have to go all the way out there for a single job.
We could then send a tradesperson to deal with all of the issues at the same time. If I can give them five, six, or seven different jobs that might be in the same house or in houses immediately next door, that really gives you a lot more leverage. And you can actually negotiate a much better rate!
You can save hundreds of pounds every single month with a medium-sized HMO portfolio just by doing this. But of course, that means not rushing to get every single reported maintenance done right away. You have to wait and see what else is in the batch, so there is a bit of work in doing that, but it’ll definitely be cost-effective.
4. Use better quality materials and more skilled tradespeople.
Make sure the tradespeople you use are skilled and that they’re using the right materials – not just the cheapest ones. That’ll help make sure the work is done once and done right! I get the attraction of using cheap labour for certain things, but the truth is sometimes you get what you pay for.
By using quality materials and skilled workers, you’re less likely to have to go back in and re-do the same work a couple of months down the line, which can be really frustrating for you and your tenants. And that can also cost you a lot more, particularly when it comes to things like bathrooms with leaks and sealants.
5. Ask for evidence, insist on guarantees, and avoid paying invoices immediately.
Ask for photographic or video evidence of the work being carried out, and wherever possible, insist on guarantees. I do that so if there’s a repeat of the same issue a couple of months down the line, they’ll go back in at no charge to resolve it. Also, avoid paying your invoices immediately.
I know that some tradespeople like to get paid overnight, but we have a policy in my business where we don’t do that (there are some exceptions to this like for my builders who do big jobs for me).
First, we put invoices into the system, and payment runs every two weeks. This gives us time to scrutinise the invoices, ask any questions or for more evidence if necessary, and see whether or not the repairs actually worked! This will help you better manage the whole maintenance process and your business as a whole.
Go and implement these five tips into your HMO business straightaway. I guarantee that these will all help you save money across your portfolio!
If you have any questions about maintenance issues you’re having, come over to The HMO Community Facebook Group and ask away. And if you want to level up your HMO business, learn how to manage maintenance in more detail, and find other ways you can keep your costs down, join The HMO Roadmap today!
About the Author:
Andy Graham is the founder and the lead trainer at The HMO Roadmap! He is also the co-founder of The HMO Mastermind and Smart Property, a specialist HMO property investment and management company. He writes as a regular columnist in different magazines about a variety of HMO topics and is the host of The HMO Podcast! Follow Andy on Instagram!