Britain’s landlords running houses in multiple occupation (HMOs) are cashing in big time – earning nearly double the income of standard rental properties.
Fresh figures show the average HMO landlord pocketed a whopping £120,283 in gross rental income per property over the past year. That’s almost twice as much as the £61,846 pulled in by traditional lets, according to data from Pegasus Insight for lender Aldermore.
Jon Cooper, Aldermore’s director of mortgages, said the gulf was striking:
“It’s common knowledge HMOs tend to deliver bigger returns, but the difference in scale here is major,” he said. “These numbers are a timely reminder of just how attractive HMOs can be as an investment.”
And the top earners are cleaning up. Almost a third of HMO landlords bank between £100,000 and £199,999 a year, compared with just one in ten non-HMO landlords. At the top of the ladder, 13% of HMO landlords make more than £200,000, versus only 5% of their single-let rivals.
But there’s a catch. Running HMOs isn’t easy money – landlords face tough planning rules and costly council checks, from gas and electricity safety to fire regulations.
The research, based on a survey of 794 landlords between June 22 and July 7, shines a spotlight on the lucrative but heavily regulated world of shared housing.