5 Key Benefits of HMOs And Why They Should Be Central to the UK’s Property Plan

Houses in Multiple Occupation (HMOs) are rapidly becoming the backbone of Britain’s rental market – and should be central to the UK’s ongoing property plan.

That’s the view of a leading property expert whose claim comes. as housing costs soar and supply struggles to keep pace with demand.

Property expert Mish Liyanage, founder of the Mistoria Group, said: “ These multi-tenant properties offer a practical solution that benefits investors, tenants and communities alike. The traditional buy-to-let model is being challenged by economic pressures and changing tenant needs. HMOs deliver superior returns while maximising the use of existing housing stock at a time when we desperately need efficient, scalable solutions.

Here, Mish outlines five key reasons why he believes HMOs deserve a central role in Britain’s property landscape:

Exceptional Rental Returns: “HMOs consistently outperform standard buy-to-let investments. The latest data shows that average HMO yields across UK regions stand at 10.4%. The North East leads with an average yield of 15.4%, while the North West and West Midlands also deliver yields above 9.6%. This outperformance highlights HMOs’ strength as high-yield assets.”

Maximising Housing Efficiency: “With Britain facing an urgent housing shortage, HMOs make better use of existing properties. Converting a home into an HMO can accommodate multiple tenants – often four to six under one roof – instantly expanding affordable accommodation without the time, cost and planning hurdles of new builds.”

Meeting Modern Living Preferences: “Shared living models resonate strongly with key tenant segments. Students, young professionals and key workers increasingly choose room-by-room tenancies for affordability and flexibility. Multiple occupancies provide diversified revenue streams, reducing income risk when individual tenants vacate and stabilising cash flow during economic uncertainty.”

Value-Creation Opportunities: “Converting standard homes into licensed HMOs can more than double rental income and boost capital values. Investment efficiency varies significantly by region: in the North East, investors need just £65,000 of capital per 1 percent of yield, compared with £542,000 in London, making the North East the most efficient market in the UK.”

Economic and Community Impact: “HMO developments stimulate local economies and address social housing needs. Renovation and maintenance work generate jobs for tradespeople, increase council tax revenues and fund vital services. In the North East, local partnerships have invested over £28.6 million to support vulnerable tenants, leveraging HMOs for social housing solutions.

Mish concludes: “The property market is evolving, and those who recognise HMOs as strategic assets rather than niche investments will be best positioned for the future. Done responsibly, HMO development supports both profitable investment and community regeneration.”

Visit https://mistoriaestateagents.co.uk/ to learn more about high-yield HMO investments