Why Our HMO and Care Investments Are Cash Purchase Only

September 11, 2026

The words cash purchase only can sometimes make people suspicious.

For some reason, people hear “cash purchase” and imagine somebody turning up at our offices with a duffle bag full of notes ready to do some questionable property deal that no lender would ever touch.

That is not what cash purchase means when you invest with Foot Forward Property Investments.

The reason is much more straightforward. We are a property developer, not a deal packager or sourcing agent, and many of the HMO and care investments we sell are development opportunities rather than completed, ready-to-mortgage investment properties.

The residential shell exists. The development work does not.

We Are Selling Development Opportunities

For over 34 years, we have developed property investments from the ground up for investors.

With our HMO investments, that normally means acquiring a standard residential property and developing it into a fully compliant 5-bedroom, 5-bathroom or 6-bedroom, 6-bathroom professional HMO. The property may require extensions, complete internal refurbishment, new plumbing, electrics, heating, fire protection, licensing work, furnishings and considerable structural or building work before it becomes the finished investment.

Our care investments work in a similar way. Investors purchase the underlying property first, then the development work begins to create the completed care asset.

Every property purchase goes through solicitors in the normal way. The investor purchases the physical property, becomes the legal owner and holds the freehold title before refurbishment funding is released.

There is no unusual ownership structure sitting behind the investment. Every property is 100% freehold and investor owned.

You Own the Property Before Paying for the Refurbishment

This is an important part of how we structure our developments.

With our HMO investments, refurbishment costs are normally paid in staged payments as the development progresses. The investor already owns the property before those refurbishment payments begin.

With our care home developments, the refurbishment and development funding can be paid upfront, but again, this only happens once the investor owns the physical freehold asset. Where the development funds are paid in one amount, the investor receives a return on those funds during the refurbishment period under the agreed investment structure.

We would be extremely cautious of any company asking an investor to hand over large refurbishment sums before they physically own the underlying property.

Until you own the asset, you are effectively handing money to somebody else and trusting them to complete the acquisition, carry out the works and protect your capital afterwards.

Our structure works the other way around. The property completes through solicitors first. You own the freehold. Development funding follows.

That gives the investor a physical asset from the outset rather than simply a promise that one will be purchased later.

Why Normal Mortgage Finance Does Not Fit

A mortgage lender will generally lend against the property that exists at the point of valuation. It will not simply add the entire future refurbishment and development budget onto a conventional residential mortgage because we intend to spend that money on the property afterwards.

That is why our development opportunities are normally cash purchases.

It has nothing to do with the finished property being defective, unmortgageable or impossible to refinance.

We can accept mortgage purchases where somebody is buying a completed, existing HMO or care property that is already suitable for normal lending.

There is a big difference between buying an established investment property and funding the creation of one.

If you are purchasing a completed HMO that already exists as a functioning HMO, a lender has a finished asset to inspect, value and lend against.

When you are purchasing one of our development opportunities, however, you are buying the property before we have carried out the work that creates much of its finished investment value.

A standard mortgage is simply not designed to fund that process.

Cash Purchase Does Not Mean Unmortgageable

This is probably the biggest misconception we hear.

Our properties are not cash purchases because there is something wrong with them. They are not being sold for cash because banks have refused to lend against the finished investment.

Once development is complete, our HMO and care investments can be refinanced, subject to the investor meeting the lender’s normal criteria and an appropriate valuation being achieved.

We help investors through that refinance process.

With our HMO developments in particular, commercial refinance can form part of an investor’s longer-term strategy once the property has been completed, tenanted and is producing income.

There certainly are properties in the market that are advertised as cash only because there are structural problems, title defects, lease issues, construction problems or other reasons that make lenders unwilling to finance them.

That is a completely different situation.

We have spent more than 34 years developing property investments. We would not put that track record at risk by deliberately developing assets that investors could not refinance afterwards.

Cash Gets the Development Moving Faster

There is another practical reason we prefer cash purchases for development opportunities: speed.

Anybody who has purchased property using mortgage finance knows how slowly transactions can move.

Mortgage applications, valuations, underwriting, lender enquiries, solicitor enquiries, additional reports and repeated requests for documentation can turn what should be a straightforward transaction into a process lasting several months.

Meanwhile, the investor is earning nothing because the property has not even entered development.

A cash purchase removes much of that delay.

Once the acquisition completes through the investor’s solicitor, development can begin. The sooner we can start building, the sooner we can finish the property, and the sooner the investor can move into the income-producing stage of the investment.

For an investor buying a development opportunity, spending several additional months waiting for a mortgage lender to work through a transaction that ultimately does not fund the development costs rarely makes much sense.

The Mortgage Comes Later

For many investors, the order is simple.

The investor purchases the freehold property using cash, we complete the development, and the finished asset can then be refinanced afterwards if leverage forms part of the investor’s strategy.

At that point, the lender is no longer looking at an ordinary residential property requiring substantial work.

They are looking at the completed investment.

In the case of one of our HMOs, that could mean a fully refurbished, licensed and compliant 5-bedroom or 6-bedroom professional HMO with tenants and an established rental income.

In the case of a care property, the investor owns the completed freehold asset with the agreed lease structure in place.

That gives the lender something very different to value compared with the residential shell that existed before development began.

We Can Consider Bridging Finance

Bridging finance can sometimes be used instead of an entirely cash-funded purchase, and we do accept bridging loans on certain developments.

However, we are careful about when we allow investors to use them.

Bridging loans are expensive debt. Interest, arrangement fees, valuation costs, legal costs and exit fees can quickly mount up if a project takes longer than expected or the eventual refinance comes in below expectations.

We will therefore only consider bridging finance where we are comfortable that the completed asset should provide a sensible and realistic refinance route capable of repaying the bridge.

We are not interested in forcing an investor into expensive short-term finance simply to make a sale happen.

If the numbers are too tight, the expected refinance is too aggressive or the bridge creates unnecessary risk, we would rather not structure the purchase that way.

Cash Purchase Is About the Development Structure

Our HMO and care investments are normally cash purchase opportunities because investors are funding a property development, not simply purchasing an investment that is already finished.

The property itself is purchased through solicitors. The investor owns it 100% freehold. Refurbishment funding is then released once that ownership is in place, either through staged payments on our HMO developments or through the agreed care investment funding structure.

Mortgage lenders generally want to lend against the asset that exists. We are creating the asset that will exist after the development work has been completed.

That is why cash comes first and, where appropriate, refinance comes afterwards.

For investors who want a completed property that can be mortgaged immediately, we can sometimes offer existing HMO or care assets where conventional lending is more suitable.

For investors purchasing one of our development opportunities, cash gives us the ability to acquire the property, establish the investor’s freehold ownership, begin the works quickly and create the finished investment without spending months trying to force a conventional mortgage product into a transaction it was never designed to fund.