HMO Property Meaning

Regulations, Myths, and Facts
When it comes to rental properties, there are many different types to choose from. One particular type of rental property that has been gaining popularity in recent years is known as HMO, or House in Multiple Occupation. In this article, we will delve into the definition of HMO properties, the regulations they must adhere to, the benefits and risks of investing in them, fascinating facts about HMOs, investment tips, and success stories of those who have invested in HMO properties.

HMO Meaning

A HMO property is a rental property where three or more tenants who are not from the same household share common areas such as a kitchen or bathroom. HMOs are often used by students or young professionals who are looking for affordable, social accommodation. Unlike other types of rental properties, HMOs are subject to specific regulations to ensure the safety and wellbeing of tenants. Read our HMO defined article for more information.

HMO Regulations Meaning

The regulations that apply to HMO properties can vary depending on the location of the property. However, there are some common regulations that apply to most HMOs. For example, HMOs must have appropriate fire safety measures in place, including fire alarms and fire doors. HMOs may also require a licence from the local council to ensure that they meet certain standards. In addition, there are often limits on the number of occupants allowed in an HMO property, to prevent overcrowding and maintain a reasonable standard of living for tenants. Read more about HMO licence requirements or HMO Rules.

Facts about HMOs

  • The term “HMO” was first used in the UK in the 1960s to describe properties that were converted into bedsits.
  • HMOs are more common in some areas of the UK than others. For example, in London, more than one in 10 households are estimated to live in an HMO. 
  • According to a survey by the Residential Landlords Association in 2018, around 20% of landlords in the UK were not aware of the current HMO licensing requirements, indicating a lack of understanding of the HMO property meaning among a significant number of landlords.
  • According to a report by the UK government in 2019, there were an estimated 518,000 HMOs in England alone, with approximately 4.5 million people living in these properties. This number is likely to have increased since then, as HMO properties continue to be a popular choice for both tenants and property investors.
  • According to the same report, it was estimated that around 20% of HMOs in England may be unlicensed, meaning that they do not meet the required standards or have not been registered with the local council.
  • Based on a report by the Greater London Authority in 2021, there are approximately 85,000 HMOs in London, accounting for around 11% of all households in the city. The report also noted that HMOs tend to be more common in certain areas of London, particularly in boroughs with high levels of student and migrant populations.
  • The UK HMO industry is worth approximately £17 billion per year.
  • The UK government makes approximately £200 million from HMO licence fees per year.
  • An HMO landlord of an unlicenced HMO in London was fined £1.5 million in 2018 for renting out their property.
  • The average rent for an HMO property in the UK is higher than for a non-HMO property. This is due to the fact that most properties, in general, can create more income if rented out room-by-room compared to as a single unit.

Common HMO Property Myths

There are many misconceptions about HMOs that can deter landlords from investing in them. Below, we will debunk some of the most common myths about HMO properties:

Myth 1: HMO Properties are Only for Students
One of the most common misconceptions about HMO properties is that they are exclusively for students. While it is true that many HMOs are occupied by students, they are also popular among young professionals, key workers, and anyone looking for affordable shared accommodation. HMO properties can be a great option for individuals who are new to a city or area and do not have the financial means to rent a single-occupancy property.

Myth 2: HMO Properties are All Low Quality
Another common misconception about HMO properties is that they are all low quality. While it is true that some HMOs are poorly maintained, there are many high-quality HMOs on the market. In fact, some landlords invest heavily in their HMO properties to ensure that they meet all legal requirements and provide a comfortable, luxurious living environment for their tenants.

Myth 3: HMO Properties are Overcrowded
There is a common misconception that HMO properties are overcrowded and that tenants are packed into small rooms with little privacy. While there have been cases of overcrowding in some HMOs, this is not true for all HMOs. In fact, HMO regulations specify a maximum number of occupants per room, and landlords must adhere to these regulations to avoid fines and legal action. 

Myth 4: HMO Properties are Only Found in Urban Areas
Another common misconception about HMO properties is that they are only found in urban areas. While it is true that many HMOs are located in cities, they can also be found in suburban areas, depending on the local rental market. In fact, some suburban areas may have a higher demand for HMO properties than urban areas due to the availability of larger properties and proximity to work sites, docks or hospitals.


Understanding the HMO property meaning and the regulations that come with it is crucial for anyone considering investing in this type of rental property. While there may be myths and misconceptions about HMOs, they have proven to be a popular and profitable investment option for landlords, especially in areas with high demand for shared accommodation. With proper management and adherence to regulations, HMO properties can provide a comfortable and affordable living arrangement for tenants while generating a steady income stream for landlords.

For specialised HMO management and letting services in South London, or if you need expert HMO advice and consultation, reach out to us today.

Carl Evans

Written By Carl Evans

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