HMO
HMO or single let: which is more profitable?
Last updated 4 July 2026 · Reviewed by Nick Thorpe, founder
The short answer
An HMO usually brings in more rent than the same house let whole: four rooms in HD1 can gross more than double a single let. But higher fees, bills, licensing and wear narrow the gap, and a single let often wins on simplicity, resale and voids. Profit depends on the house and the area.
How much more rent does an HMO bring in?
Letting a house by the room usually grosses a lot more than letting it whole. The table below uses our current letting ranges, maintained by our lettings team, as of July 2026, for three districts we let in every week. These are working estimates, not formal valuations, and the four-room column is simply the room rate multiplied by four.
| District | Whole house, per month | Per room, per month | Four rooms let, per month |
|---|---|---|---|
| HD1, Huddersfield | £595 to £850 | £430 to £560 | £1,720 to £2,240 |
| LS6, Leeds | £895 to £1,295 | £520 to £700 | £2,080 to £2,800 |
| S70, Barnsley | £550 to £775 | £400 to £520 | £1,600 to £2,080 |
Yields tell the same story. HD1 gross yields typically run at 6 to 7%, with well-run HMOs above that. Student HMOs in LS4 and LS6 reach 7 to 9% or more, while Leeds city-centre flats sit around 5 to 6.5%. Barnsley averages roughly 7% gross borough-wide, with S70 at 7 to 9%. Those are gross figures, and gross is exactly where HMO spreadsheets tend to get optimistic.
Why the HMO gap is smaller than it looks
An HMO costs more to run, so the net gap is much narrower than the gross one. Our management fee is 12% of monthly rent plus VAT for an HMO against 10% plus VAT for a single let. In a single let the tenant pays the utilities and council tax. In an HMO the landlord usually covers utilities, broadband and often the council tax too, and those bills come out of that headline rent every month.
Then there are the running costs. Shared areas need regular cleaning to stay lettable (ours is £60 plus VAT every three weeks, £80 for the first). Rent and legal protection, if you want it, is £275 plus VAT per room per year. Four tenants is four of everything: four tenancies, four deposits, four referencing checks, and four sets of phone calls. Turnover is higher and so is wear.
The honest upside is voids. When one tenant leaves a four-room HMO you lose a quarter of the rent, not all of it. Our full fee schedule for both models is public at our fees page, with maintenance at contractor cost and no markup.
What about licensing and planning?
An HMO carries rules a single let never sees. Across England a licence is mandatory once five or more occupants from two or more households share the house, and some councils run additional schemes on top.
Locally, the picture varies a lot. Kirklees runs mandatory HMO licensing only, with no additional or selective schemes as of mid 2026, which keeps Huddersfield HMOs relatively simple. Leeds is stricter: Article 4 directions in Headingley, Hyde Park, Burley and other student areas mean new small HMOs need planning permission, and selective licensing expanded in February 2026 across parts of six wards, covering around 12,500 properties at £1,100 per licence whatever the size. Letting an unlicensed property in a designated area is a criminal offence: it can mean prosecution with an unlimited fine, or a civil penalty of up to £40,000.
Rules change, so we confirm the current requirements with the council before we take on or set up any HMO.
When does a single let win?
A single let wins when your priorities are time, stability and a clean exit rather than the top line. One tenancy, one deposit, and the tenant pays the bills. Across our managed homes the average tenancy runs 24 months, so a good single let can sit quietly for two years while an HMO is re-advertising rooms.
A family house on a family street often lets whole near the top of its range and would make a poor HMO anyway. Mortgages and insurance are simpler and cheaper for single lets, and when you sell, a whole house appeals to owner-occupiers as well as investors, while an HMO mostly sells to other landlords. And if the HMO sums only work at full occupancy all year, treat them with suspicion.
How to decide
- Get both numbers for your actual address. Our rent estimate covers whole-house and room rates.
- Run the yield both ways using real costs, not gross rent. Our yield calculator does the arithmetic.
- Check licensing and planning with the council before spending a pound on conversion.
- Be honest about your time. If you want the HMO rent without the phone calls, our HMO management service handles the lot.