diff --git a/changelogs/fragments/664-debug-virt-install.yml b/changelogs/fragments/664-debug-virt-install.yml
new file mode 100644
index 00000000..1413b7b9
--- /dev/null
+++ b/changelogs/fragments/664-debug-virt-install.yml
@@ -0,0 +1,3 @@
+---
+bugfixes:
+  - he-setup - Run virt-install with options more suitable for debugging (https://github.com/oVirt/ovirt-ansible-collection/pull/664).
diff --git a/changelogs/fragments/664-log-local-vm-console.yml b/changelogs/fragments/664-log-local-vm-console.yml
new file mode 100644
index 00000000..5d3bb775
--- /dev/null
+++ b/changelogs/fragments/664-log-local-vm-console.yml
@@ -0,0 +1,3 @@
+---
+bugfixes:
+  - he-setup - Log the output sent to the serial console of the HostedEngineLocal VM to a file on the host, to allow diagnosing failures in that stage (https://github.com/oVirt/ovirt-ansible-collection/pull/664).
diff --git a/roles/hosted_engine_setup/tasks/bootstrap_local_vm/02_create_local_vm.yml b/roles/hosted_engine_setup/tasks/bootstrap_local_vm/02_create_local_vm.yml
index e02728bb..3a3e94e1 100644
--- a/roles/hosted_engine_setup/tasks/bootstrap_local_vm/02_create_local_vm.yml
+++ b/roles/hosted_engine_setup/tasks/bootstrap_local_vm/02_create_local_vm.yml
@@ -106,8 +106,9 @@
             virt-install -n {{ he_vm_name }}Local --os-variant rhel8.0 --virt-type kvm --memory {{ he_mem_size_MB }}
             --vcpus {{ he_vcpus }}  --network network=default,mac={{ he_vm_mac_addr }},model=virtio
             --disk {{ local_vm_disk_path }} --import --disk path={{ he_local_vm_dir }}/seed.iso,device=cdrom
-            --noautoconsole --rng /dev/random --graphics vnc --video vga --sound none --controller usb,model=none
-            --memballoon none --boot hd,menu=off --clock kvmclock_present=yes
+            --autoconsole text --rng /dev/random --graphics none --sound none --controller usb,model=none
+            --memballoon none --boot hd,bootmenu.enable=on,bios.useserial=on --clock kvmclock_present=yes
+            --serial=pty,log.file=/var/log/libvirt/qemu/HostedEngineLocal-console.log
           environment: "{{ he_cmd_lang }}"
           register: create_local_vm
           changed_when: true