The HMO market in England & Wales is valued at £78bn and generates annual rental income of £6.3bn, according to COHO, an HMO management platform.

There are some 182,554 HMOs in England and Wales. Of these 74% are small; – that is,HMOs, shared by three or four tenants.

Meanwhile 26% are designated as large with five tenants or more.

London has the largest proportion of HMOs, accounting for a third – 33.9% – followed by the South East (13.6%), South West (10.7%), North West (8.4%), and Yorkshire & Humber (7.4%).

The average value of an HMO in England and Wales is £293,197 giving the entire HMO stock an estimated value of some £78 billion.

In London, where the average HMO value is £660,227, the stock has a combined value of almost £40.9 billion.

The South East has an average HMOs price of £436,146, creating a total regional value of £10.8 billion.

HMO stock in the South West has an estimated combined value of £7.9 billion followed by the North West at £4.0 billion.

The average annual rental income for an HMO in England and Wales sits at £29,715.

While London has the largest combined HMO rental income, individual properties actually generate the most rental income in the South East, where each HMO averages £46,042. 

This gives the region a combined rental income of more than £1.1 billion.

In the South West, the HMO market generates rental income of £747.3m, and in the North West it’s £419.2m.

While the Yorkshire & Humber region is home to the lowest average HMO value (£196,014) and second-lowest average rental income (£21,208), it still outperforms Wales and the North East for combined stock value and combined rental income.

Meanwhile, the East Midlands commands the lowest average annual rental income per property (£20,223) but with an average HMO value of £236,779, its total stock value of £2.9 billion is higher than Yorkshire & Humber, Wales, and the North East.

A COHO spokesperson says: “HMO market’s value is going to keep increasing not only because of the constant and growing demand from a variety of tenant demographics, but also because rising tenant expectations means landlords are going to improve the standard of living and thus benefit from stronger rental income.”