HMO Yield Calculator UK

A gross HMO yield of 10–15% is achievable in many UK cities. Because rents are charged per room, HMOs typically yield 30–50% more than the equivalent single-let property. In high-demand student and professional cities — Sheffield, Nottingham, Leeds, Manchester — gross yields of 12–15% are common. Net yield after all costs (management, bills, maintenance, voids) is typically 7–10%.

A property occupied by 3 or more unrelated tenants who share facilities (kitchen, bathroom) is classed as an HMO in England. Properties with 5 or more unrelated occupants across 2 or more storeys require a mandatory HMO licence. Smaller HMOs may require an additional licence in selective licensing areas.

HMO gross yield = (Total monthly room rents × 12) ÷ Purchase price × 100. For example, 5 rooms at £550/month = £6,600/month × 12 = £79,200/year ÷ £220,000 purchase price = 36% gross — but deduct mortgage, bills, management (typically 15%), maintenance and voids to get a realistic net figure. This calculator handles all deductions automatically.

Yes. Any HMO with 5 or more unrelated occupants in England requires a mandatory HMO licence from the local council. Additional licensing schemes vary by council — some require licences for 3+ occupant HMOs. Unlicensed HMOs can face significant fines and rent repayment orders. Always check your local council's licensing requirements before converting a property.

Typical HMO running costs: mortgage (if applicable), HMO management fee (12–15% of gross rents), utility bills (gas, electric, water, broadband — often landlord-paid), council tax, HMO licence fee, annual fire safety checks, furniture replacement, and higher void rates between tenancy cycles. This calculator itemises the core costs to give an accurate net cashflow.