Most bad property investments go wrong before the keys are handed over.
Not because the house was ugly or the street was quiet. Because something nobody checked turns up later. A licence the council won't grant. A bedroom that's legally too small. A loft conversion that was never approved. A valuation that comes in £40,000 below the plan.
By then, the money has been spent. So we do the homework first. Here is what we check on every property, before an offer becomes a purchase and before any of your money moves.
1. Licensing: can it legally be let the way we plan?
In England, many rented homes need a licence from the local council before a tenant moves in. There are three kinds, and a property can fall under more than one:
- Mandatory licensing: any shared house (known in the trade as an HMO, a house in multiple occupation) with five or more people from two or more households needs a licence, wherever it is.
- Additional licensing: councils can extend licensing to smaller shared houses in some or all of their area.
- Selective licensing: councils can require a licence for every privately rented home in a chosen area, even a family let to one household.
The map is changing. Since December 2024, councils in England no longer need government approval to bring in selective licensing schemes, so more areas now have them. Schemes can cover a whole borough or just a few streets, so we check the exact address, not the town.
For each property, we confirm which scheme applies, what the licence costs, what conditions come with it, and how long the council typically takes to issue it. Letting without the right licence can mean heavy fines, paying back rent to tenants and difficulty regaining possession. It is not a risk worth taking.
2. Room sizes: does every bedroom count?
In a licensed shared house, each bedroom must meet national minimum sizes:
| Bedroom for one adult | at least 6.51 m² |
|---|---|
| Bedroom for two adults | at least 10.22 m² |
| Bedroom for one child under 10 | at least 4.64 m² |
| Any room under 4.64 m² | cannot be used as a bedroom |
Two details catch people out. Floor space where the ceiling is lower than 1.5 metres doesn't count, which matters in lofts and rooms under the eaves. And many councils set their own, higher standards on top, including how many people can share each kitchen and bathroom.
We don't rely on the estate agent's floor plan, which is usually marked as approximate. We measure. A room that's a little short isn't a small problem. One room fewer means less rent. Less rent means a lower value at refinance. A few centimetres can change the whole deal.
3. Planning: is the plan allowed?
Some changes to a house need planning permission, and the rules vary from council to council:
- Family home to small shared house (three to six unrelated people): this normally doesn't need planning permission, unless the council has removed that right in the area with what's called an Article 4 direction. Many university towns and cities have done exactly that.
- Larger shared houses (seven or more people): these always need planning permission.
- Local limits: some councils refuse new shared houses where there are already too many on the same street or within a set distance.
- Extensions, loft dormers and conversions into flats: these may need planning permission, and they always need building regulations sign-off.
We also look backwards. Has a previous owner extended, converted the loft or split the house without approval? An unapproved loft room may not count as a legal bedroom, and it may need fire safety work before anyone can sleep in it. Listed buildings and conservation areas bring their own restrictions too.
The street gives clues too. Skylights on the neighbours' roofs suggest the loft space is big enough to convert. Extensions in the neighbours' gardens show the council has approved similar work before. They're not a guarantee, but they tell us where to look.
Where a plan depends on planning permission, we take advice from a planning consultant and have drawings prepared before we commit, not after.
4. The house itself: what are we really buying?
The tired houses we look for are often old, which is fine, as long as we know exactly what we're taking on.
- A full building survey (RICS Level 3 for older or neglected houses), covering the roof, structure, damp, electrics, gas, heating, water and drainage. Every defect gets a cost in the refurbishment budget.
- The legal pack: the title, boundaries, rights of way and any restrictions in the deeds, checked by the solicitor.
- Energy efficiency: a rented home in England currently needs an EPC rating of E or above. From 1 October 2030, every private rented home will need to reach C, with a cap on the cost a landlord has to spend. We would rather do that work once, during the refurbishment, than come back for it later.
Higher standards for private rented homes are on the way too, under the Renters' Rights Act. A property refurbished properly now is better placed when they arrive.
5. Demand: who will live here, and will they keep coming?
A beautifully refurbished house nobody wants to rent is a bad investment. So before we buy, we look for evidence:
- Achieved rents, not asking rents. What similar homes nearby actually let for.
- How long homes sit empty between tenants.
- What's driving demand: a hospital, a university, a business park, a station, a growing town centre.
- Competition: how many similar homes are already on the market, and how ours will compare.
We speak to local letting agents who let property on that street every week. Their view of who rents there, and what those tenants expect, shapes how we refurbish. Not to our taste. To theirs.
6. End value: what will it be worth when it's finished?
This is the number that decides everything. When a property is refinanced, the bank lends against the value its own valuer puts on it. Not our estimate. Not the seller's.
So we look at what finished homes on the same street, or very close by, have actually sold for recently. We look at the ceiling price for that street, because every street has one, and no refurbishment will push a house far past it. And we check how lenders will value it. Some lenders value shared houses on comparable sales, others on the rent they produce, and the difference can be large. So we speak to a mortgage broker about the finished property before we buy the unfinished one.
Then we run the deal on cautious numbers:
- a lower valuation than we expect
- higher refurbishment costs
- works taking longer, so finance costs run for longer
- a few months of empty rooms
If the deal still works on those numbers, we go ahead. If it only works when everything goes right, we walk away.
The cheapest time to find a problem is before you own it.
What you see before you decide
None of this happens behind closed doors. Before any decision, you receive a property pack setting out what we want to buy and why, the costs, the refurbishment budget, the plan for letting and managing it, and how we exit if we need to.
You approve every purchase in writing before it happens. And after we buy, we're judged against what we said in that pack.
Many properties fail at least one of these checks. That's the point. Every house we turn down protects your capital. The ones that pass go ahead with their problems already found and costed.
Two ways to work with us
Buy for you: we do the work, you own 100% of every property in your own UK company. How it works.
Invest with us: we set up a private company together, you provide the capital and we share the results. How it works.
Either way, the first step is the same: book a 30-minute call.
Rules summarised here apply in England as of October 2026 and can change. Licensing and planning rules vary by council, and specific properties need specific checks. This article is general information, not financial, tax, legal or planning advice. Property values can fall as well as rise, and rental income is not guaranteed.