Why restricting HMOs could make the UK’s rental supply crisis worse
6 days ago | 2 comments
Insane student HMO heating costs?
12:05 AM, 13th October 2026, 11 hours ago
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Hi, I know I’m not alone, but my energy bills have gone through the roof in my student HMO’s.
For over 20 years I let my houses exclusive of bills but a few years ago the local market (York) changed and now students (and likely their parents) insist on bills included.
Whilst I would “load” the rental figure to allow for more usage than average, despite rent increases every year the energy costs far exceed any increases. Tenants are stretched to their absolute limit as it is thanks to years of government policies that we are all too familiar with so I cannot simply keep raising the rents in line with increased energy costs.
I’m genuinely terrified that with 4 fixed rate mortgages coming to and end next year (in addition to my own home) and energy prices set to rise around 20% in January I just don’t know how I’m going to be able to keep going.
As with so many landlords, our gross rental income has gone up massively but our net disposable income is getting significantly lower each year. I don’t expect tiny violins but as a responsible, experienced landlord of 25 years I’ve built up a good business, with many hundreds of happy tenants and I’ve already disposed of the less profitable properties to try to keep going.
My point is that with a perfect storm of higher interest rates and ever increasing energy costs do any readers have any practical suggestions of how to keep energy costs down – maybe offering out of the box bespoke bills inclusive / exclusive rents or physically limiting energy usage?
Any suggestions I’m sure would be appreciated by other readers too.
PLEASE no lectures from smug landlords who own their properties mortgage free!
Thank you,
Andy
Tags:
bills-inclusive rents, Buy to let mortgages, HMO profitability, Landlord Energy Costs, student HMO, student landlords
3 comments on this article
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Member Since May 2017 - Comments: 26
9:52 AM, 13th October 2026, About 59 minutes ago
I too am a responsible landlord of more than 25 years and I am still renting my HMO exclusive of bills. I take care to point out that I only charge what is on the bill with copies supplied, but If I was to make it inclusive I would be forced to put on a surcharge to cover myself as do not know how they will use the utilites. My system means they only pay for what they use, and if a member of the household is being wasteful it is in their power to police it.
I don’t think I have lost any tenants because of this. I generally give them an idea of average monthly costs.
Member Since June 2015 - Comments: 365
10:21 AM, 13th October 2026, About 30 minutes ago
The next year or two are going to be incredibly painful, especially for those of us coming off decent 5 year mortgage fixes. I’ve got 5 due in the next 9 months and the figures out there today are horrifying.
In terms of energy costs a fix would give some stability, although compared with last winter at a much higher cost. It would at least avoid the January increase.
There are various heating programmers designed for the HMO market. The base programme is set by you and can only be altered by you. The tenants can boost it for a set time period if they feel the need. I’ve got them in 4 houses and the 3 more expensive ones (£279 each) are very good. The cheap one (£99) is very disappointing. There is another one priced in between which I may try soon. I also tend to provide electric heated throws and encourage any tenant who is cold while housemates are sleeping to use that instead of zapping the central heating on. Quite a few of them favour that option when they are studying in their rooms or WFH because it means they don’t have to walk downstairs to the programmer. The base setting is around 21 degrees for a couple of hours when they are likely to be getting up, 19 during the day, 20 or 21 during the evening and 18 at night. They can boost it to 22 degrees for an hour anytime they want. It takes minutes for the house to heat up and hours to cool down. The bedrooms tend to be warmer than the lounge as heat rises.
Another way of limiting utility usage is to look back over the previous 2 or 3 years usage, compare with other houses or industry averages. Then set a realistic expected use limit and offer to refund any under usage. It’s only likely to be a small amount but it may make them very mindful of their usage.
Member Since May 2017 - Comments: 26
10:41 AM, 13th October 2026, About 11 minutes ago
Reply to the comment left by Jo Westlake at 13/10/2026 – 10:21
Many thanks for the suggestion Jo. I will look into that.
I too have 5 mortgages reaching the end of their 5 year terms from March onwards all within less than 12 months. It is indeed a frightening prospect that my mortgage payments are likely to double and push my “taxable income” well into the higher rate tax bracket meaning my real income will go down dramatically whilst my tax will increase dramatically!