The combined value of the nation’s houses in multiple occupation (HMO) market is estimated to be almost £26bn in current market conditions, new analysis by Revolution Brokers has indicated.

London is by far home to the most valuable HMO portfolio of all regions across the rental market in England.

The research by Revolution Brokers revealed that there are currently 55,849 HMOs operational across England. With the average HMO worth 464,546 in the current market, the figures equate to a total market value of £25.94bn.

With 13,528 HMOs found in London alone, the capital is home to the highest proportion of HMO rental properties in England. It is also home to the highest average HMO house price at £826,209 and, as a result, the highest total HMO market value of all regions at £11.2bn.

Revolution Brokers’ analysis also highlighted that the East Midlands is England’s second HMO hotspot, with the 10,737 HMOs located in the region accounting for 19% of the total stock. However, with an average house price of £274,126, the region is home to a total market value of £2.9bn, just the fourth largest in the nation.

The South West and South East sit second and third when it comes to total HMO market value, with HMO stock in each region sitting at £3.8bn and £3.3bn respectively.

Figures show the North East is home to the lowest level of HMO properties, with 715 accounting for just 1.3% of the national total. With an average HMO house price of £263,024, it is also home to the most affordable HMO price tag, although the total market value of the region’s HMO portfolio still sits at £118m.

Revolution Brokers founding director, Almas Uddin, commented: “We’ve now started to see the HMO sector come under the same scrutiny as the wider buy-to-let space when it comes to a raft of new rules and regulations designed to improve tenant welfare.

“While this is, of course, a step in the right direction, it means additional time and money spent by HMO providers to ensure they are operating above board.

“The worry is that these additional requirements may deter HMO investment and reduce the level of suitable HMOs that are available, leaving tenants with no choice but to rent from those who were already providing below-par accommodation and will no doubt continue to do so.

“The good news is that so far, this doesn’t seem to be the case and the nation’s HMO portfolio not only remains robust, but is worth an incredible sum in the current market.”

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