HMO Calculator (Room-by-Room Yield & Cashflow)

HMOs typically gross 10 to 15 percent against 5 to 8 for single lets, because the same house earns several room rents. The gap narrows sharply after costs: bills-included rents, higher management fees, more wear and more frequent voids all come out of the headline figure, which is why this calculator shows the net monthly cashflow alongside the gross yield.

A licence is mandatory in England for HMOs housing 5 or more people from 2 or more households. Smaller HMOs can still need a licence under a council's additional or selective schemes, and planning permission (an Article 4 direction) can also apply. Check with the local council before you buy, because running an unlicensed licensable HMO is a criminal offence with fines and rent repayment orders.

Almost all HMO rooms let on a bills-included basis, so utilities, broadband and often council tax are the landlord's cost, not the tenant's. At £100 to £150 per room per month that is frequently the largest expense after the mortgage. The calculator keeps bills running even for the void allowance, since standing charges and broadband contracts do not stop when a room is empty.

An HMO usually produces more cashflow from the same building, but it costs more to run, takes more management, needs a licence in many areas, and can be harder to mortgage and sell. The comparison line in this calculator shows the monthly uplift over letting the same property as a single let, so you can judge whether the extra income pays for the extra work and risk.