Best city in England for HMO yield revealed

Bradford has claimed the title of England’s top location for House in Multiple Occupation (HMO) yields, with six-bedroom properties delivering an impressive 15.2% return, research reveals.

According to COHO, an HMO management platform, its analysis highlights that larger HMOs consistently outperform their smaller counterparts, despite requiring greater initial investment.

COHO’s research shows that three-bedroom HMOs across England yield an average of 7.1%, based on an average asking price of £302,546 and monthly rental income of £593 per room.

In contrast, four-bedroom HMOs achieve a stronger 8.5% yield, with an asking price of £336,252, only slightly higher than three-bedroom properties.

The most lucrative returns come from five- and six-bedroom HMOs, both averaging 8.7% nationally.

Most profitable HMOs

The firm’s chief executive, Vann Vogstad, said: “The most profitable HMOs are located in cities in or towards the north of England where property prices are significantly lower than the likes of London and the south.

“And while London landlords benefit from a much higher monthly rental income, it’s still not enough to offset the large upfront investment to an extent that will bring yields on par with those available in the likes of Bradford or Liverpool.”

He added: “However, all is not lost for the capital’s landlords because a new shared living sector has emerged over recent years which promises to bolster yields in the capital and beyond: co-living.

“Co-living is distinct from HMOs in a number of ways, not least the way in which they are conceived, designed and managed.”

Five- and four-bedroom HMOs

In England, Bradford stands out, with six-bedroom HMOs priced at just £228,750, generating £482 per room monthly, resulting in the highest yield of 15.2%.

Liverpool follows with 10.8% for six-bedroom HMOs, while Leicester records 10.1%.

For five-bedroom properties, Bradford again leads with 10.1%, trailed by Leicester (10%) and Leeds (9.8%).

Liverpool dominates four-bedroom HMO yields at 11.9%, with Sheffield (10.2%) and Nottingham (9.6%) close behind.

For smaller three-bedroom HMOs, Newcastle tops the list with 10.7%, followed by Manchester (9.8%) and Liverpool (9.3%).