HMO Market Statistics 2026

Key HMO Market Figures at a Glance

UK HMO Rental Yield Statistics by Region

HMO rental yields vary significantly across the UK, with Northern cities consistently outperforming London on a gross yield basis. This pattern is confirmed by independent research: Paragon Bank's Q3 2025 Buy-to-Let Yield Report recorded average HMO yields of 8.48% — the highest of any property type — while Lendlord's Q4 2025 HMO data found regional HMO yields averaging 9.6%, ranging from 8.0% in Greater London to 15.1% in the North East. The table below shows indicative gross yield ranges for well-maintained licensed HMO properties in each region, based on our own market intelligence.

Gross yields are calculated as annual rental income divided by purchase price, before mortgage, management, and maintenance costs. Net yields are typically 2–4 percentage points lower.

HMO Property Growth Trends

The number of HMO properties in England has grown substantially over the past decade, driven by rising rents, housing affordability pressures, and growing demand from young professionals and students who cannot afford single-occupancy renting.

Despite regulatory headwinds, the underlying demand fundamentals for HMO properties remain strong. The UK housing shortage means tenant demand in most university cities and urban centres continues to outstrip supply, supporting occupancy rates above 95% for well-managed properties. For a full overview of investment considerations, see our HMO property investment guide.

HMO Licensing Statistics

HMO licensing data is collected and published annually by the Ministry of Housing, Communities and Local Government (MHCLG) in its Local Authority Housing Statistics data returns, which record each council's estimate of total HMOs, mandatory licensable HMOs, and licences issued. The following figures reflect the most recent available data.

Mandatory HMO Licensing

Mandatory HMO licensing in England applies to all properties occupied by five or more people forming two or more households who share facilities. In the 2024-25 MHCLG data returns, councils estimated around 132,000 HMOs in England fall within mandatory licensing, with roughly 95,000 licences actually issued — though enforcement levels vary significantly between local authorities.

Additional Licensing Schemes

Over 70 councils in England have introduced additional licensing schemes extending HMO licence requirements to smaller properties — typically those with three or four occupants. Cities including Nottingham, Bristol, Brighton, Newham, and Liverpool operate city-wide additional licensing.

The trend towards additional licensing continues to grow as councils seek greater oversight of the private rented sector. Landlords should verify current requirements with their local authority before purchasing or converting a property. Our HMO licensing changes page covers the latest regulatory updates.

HMO Mortgage Market Data

The HMO mortgage market has grown substantially over the past decade, with more specialist lenders entering the sector and increasing competition driving more competitive rates for landlords.

The HMO mortgage market is specialist by nature. The majority of the best-value HMO mortgage products are available exclusively through specialist mortgage intermediaries. Borrowers who approach lenders directly typically access a fraction of the available products. See our HMO mortgage rates page for recently reviewed pricing across all product types.

Sources & Methodology

The statistics on this page draw on the following publications. Journalists and researchers are welcome to cite this page with attribution; the underlying primary sources are linked below.

• MHCLG, Local Authority Housing Statistics data returns for 2024 to 2025 (GOV.UK, published November 2025) — each English local authority's estimate of total HMOs, mandatory licensable HMOs, and mandatory HMO licences issued (dataset section F). The full annual series is available in the local authority housing data collection, with methodology in the LAHS technical notes 2024-25.
• GOV.UK, House in multiple occupation licence guidance — mandatory licensing criteria (five or more people forming more than one household) and the maximum five-year licence term.
• Paragon Bank, Buy-to-Let Yield Report Q3 2025 (reported by Property Reporter, October 2025) — average HMO gross yield of 8.48%, the highest of any property type tracked.
• Lendlord, HMO Data Q4 2025 — analysis of 1,158 HMO properties showing regional gross yields averaging 9.6%, from 8.0% (Greater London) to 15.1% (North East).
• The HMO Mortgage Broker internal lending data (2013–2026) — mortgage product metrics, city-level indicative yield ranges, lender panel figures, and market intelligence from arranging over £187m of HMO lending.

Gross yield methodology: annual rental income divided by purchase price, before mortgage, management, maintenance, and void costs. Licensing and property counts are as reported by local authorities to MHCLG and may be revised in later releases.