BRRR (Buy, Refurb, Refinance, Rent)
Investor strategy: buy below market, refurb to add value, refinance at the higher valuation to pull most of the cash back out, then rent. A successful BRRR leaves little to no money in the deal.
Property Investment Glossary
Plain-English definitions of every term Dwelfy uses on a property page. Filter by strategy, yield, mortgage, tax, risk — or just type what you're looking for.
Strategies · 5
Buy-to-Let (BTL)
A property bought to rent out, not live in. BTL mortgages have different criteria (rental income stress test, minimum income) and 5% SDLT surcharge applies.
HMO (House in Multiple Occupation)
A property let to 3+ tenants from different households sharing facilities. Higher yields, more compliance (licensing, fire safety, room sizes). Mandatory licensing at 5+ tenants.
LHA (Local Housing Allowance)
The housing-benefit rate the council pays for a given property size in a given area. Letting to LHA tenants gives lower headline rent but very low voids and council-paid rent direct.
SA (Serviced Accommodation)
Short-let strategy (Airbnb-style) — higher per-night rates, higher voids, much more management. Subject to local 90-day caps and changing regulation in many UK cities.
Yield & cashflow · 10
Cap Rate (Capitalisation Rate)
US/commercial yield benchmark: Net Operating Income ÷ Property Value. Cap rate is independent of how the deal is financed.
CapEx Reserve
A monthly set-aside for big-ticket replacements: boiler, roof, windows, kitchen. Typically 5–10% of rent. Often missing from headline cashflow numbers — but the cost is real.
Capital Appreciation
Growth in property value over time. UK average is ~3% per year over the long run; varies hugely by region.
Cashflow (monthly)
Rent minus all monthly costs (mortgage, agent, void provision, maintenance, insurance, leasehold). Positive cashflow means the property pays you each month.
Gross Yield
Rental yield before any deductions for mortgage, maintenance, voids, insurance or management.
Open calculator →Net Yield
Rental yield after deducting running costs (mortgage interest, letting fees, maintenance, voids, insurance, service charge).
Open calculator →NOI (Net Operating Income)
Annual rent minus operating expenses (excluding mortgage and tax). Used in cap-rate and DSCR maths.
Rental Yield
Annual rent as a percentage of the property's purchase price. Gross yield = (annual rent / price) × 100.
Open calculator →ROI (Return on Investment)
Total return — rental profit + capital appreciation — as a percentage of cash invested (deposit + refurb + fees).
Open calculator →Void Period
Time the property is empty between tenancies. Reduces effective annual rent; typical allowance is 2–4 weeks per year.
Mortgage & financing · 3
DSCR (Debt Service Coverage Ratio)
US equivalent of ICR — Net Operating Income ÷ annual debt service. Lenders underwrite at 1.2× minimum; 1.25× and above gets best rates.
ICR (Interest Coverage Ratio)
Lender's stress test: rent ÷ stressed mortgage interest. Most BTL lenders require ICR ≥ 1.25 at a stress rate of 5.5–7.5%. ICR < 1 means the rent cannot cover the stressed mortgage.
LTV (Loan-to-Value)
Mortgage amount as a percentage of property value. A £150k loan on a £200k property = 75% LTV. BTL lenders typically cap at 75%; investor mortgages get cheaper as LTV drops.
Open calculator →Tax · 3
FTB (First-Time Buyer)
Buyers who have never owned UK residential property before. Get SDLT relief up to £425k and access to specific mortgage products.
SDLT (Stamp Duty Land Tax)
UK property purchase tax (England & NI). Banded by price; investors pay a 5% additional-property surcharge; non-UK residents pay a further 2%.
Open calculator →Section 24
UK rule restricting BTL mortgage-interest tax relief to a 20% credit (instead of being deducted as an expense). Hits higher-rate landlords hardest; ltd-company landlords are not affected.
Risk & regulation · 4
Article 4 Direction
A council planning restriction that removes the automatic permitted-development right to convert a family home to an HMO. In an Article 4 area you must apply for full planning permission — councils with high refusal rates make HMO conversion plays risky.
EPC (Energy Performance Certificate)
Gov-issued energy rating from A (most efficient) to G. Lodged on the gov.uk register; valid for 10 years. Affects lettability (MEES) and running cost projections.
EWS1 (External Wall System certificate)
A fire-safety certificate required by most lenders for flats in mid- and high-rise blocks since Grenfell. No EWS1, or a B1/B2 rating, can make a flat unmortgageable.
MEES (Minimum Energy Efficiency Standards)
From 2030 (proposed), private rental properties must achieve EPC C or above. EPC F/G properties are currently unlettable on new tenancies unless an exemption applies.
Other · 3
BMV (Below Market Value)
A property priced below comparable recent sales — typically due to motivated seller, repossession, or refurb need. A common deal-finder metric is BMV %.
GDV (Gross Development Value)
The post-refurb / post-conversion sale or valuation price. Used in BRRR and flip maths to size refinance and exit profit.
pp (percentage points)
The arithmetic difference between two percentages (e.g. 8% vs 5% = +3 pp). Distinct from a relative percentage change.