Case Study: Derby 3-Bed Terrace to 6-Bed Professional HMO

An experienced investor turns a standard three-bedroom terrace into a high-performing six-bedroom professional HMO, with the purchase and the full refurbishment funded by Ramsay & White.

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The story

Our client was an experienced investor looking to scale their portfolio by moving away from traditional buy-to-lets and into higher cash-flowing professional HMOs.

The objective was to maximise the property's value through planning, refurbishment and intelligent finance, while recycling as much capital as possible into the next project. Working with a property investment company that managed the process on the ground, and with Ramsay & White structuring the funding, the plan was to take a standard three-bedroom terrace and reposition it as a high-quality professional HMO.

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Funding solution

- Purchase price: £225,000

- £131,768 towards the purchase

- 100% of the £190,000 refurbishment costs funded

- Development finance structured to support a full BRRR strategy

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Outcome

- Converted into a 6-bedroom HMO with 3 en-suite rooms

- GDV: £620,000

- Rental income: £5,500 pcm

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Key result

The client significantly increased both the property's value and rental income, creating a high-quality professional HMO while preserving capital for future acquisitions.

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Interested in HMOs? Here is how to maximise your returns

Professional HMOs remain one of the most effective ways to increase the rental income from a single property. Industry figures suggest HMO landlords can earn significantly more gross rental income than standard single-let landlords, and deals like this one show what is possible when the right property is paired with the right finance.

The key is structuring the funding so that both the purchase and the refurbishment are covered. That allows you to add value, refinance on the improved figure and recycle your capital into the next project, while the finished HMO delivers strong monthly cash flow in the meantime.

We regularly break down real HMO conversions, deal structures and finance strategies in our recent webinars and videos. You can watch them on our YouTube channel here: youtube.com/@ramsayandwhite.

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How Ramsay & White can help

This project is a good example of what the right funding structure makes possible. The client worked with a property investment company that managed the process from end to end, while Ramsay & White structured the finance behind it, funding the purchase and the refurbishment so that as little capital as possible was left tied up in the deal.

The aim on deals like this is always the same. Uplift the value of the property through refurbishment, refinance so the investor can pull most or all of their money back out, then use that recycled capital to go again on the next project while keeping the monthly rental income.

If you are working on an HMO conversion, looking to scale a portfolio, or you want to understand how a purchase and refurbishment could be funded together, our team is here to help.

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