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  • Mike Lightfoot

Now we’ve listed a professional HMO business it’s probably time to cover what a HMO business does

HMO is a term that is used to define accommodation that is owned by a private landlord or property or facilities management business and which is shared among a number of people. The acronym stands for a “House in Multiple Occupation”. There are a range of different types of accommodation that could fall under this definition, depending on how many people are living there and what the living arrangements are. As a general rule, where there are three or more tenants in a property who make up more than one household with shared toilet, bathroom or kitchen facilities, this could be an HMO.


This could cover:


  • A number of bedsits in one building

  • A hostel

  • Halls of residence (private)

  • A shared house

  • A block of converted flats

  • Individual shared self contained cluster flats.

  • Student accommodation etc


The HMO business model


Operating a HMO property management or facilities business is very different to being a traditional property manager where you may be managing a series of apartments or individual let properties. However, the way in which HMO facilities operate can generate higher yields for the business owner than traditional managed property portfolios because of the communal way in which they operate.


For instance all property related services are generally shared services so unlike a portfolio of apartments there is no need for the manager to maintain separate metering and services to each individual unit which can reduce operating costs. Also more flexible tenancies can be entertained due to the specific purpose of the multiple occupancy facility (ie, student accommodation etc).


Increased rental yield is the main benefit of a property manager going down a HMO model.

By increasing the number of tenants that can be accommodated within a property you’re effectively boosting the number of people who are paying rent each month as well as reducing the costs of providing basic property related services.


The risks of operating a HMO facility are similar to any other form of property letting. Although failure of the business to manage a property to the required standards can be a criminal offence.


Managing HMOs means meeting different standards


Simply because of the larger number of people under one roof, the landlord of an HMO has higher standards to meet. For example:

  • Safety – gas safety checks must be carried out every year and electrical system checks regularly too.

  • Sanitation – ensuring that there are adequate rubbish disposal facilities, bins and bin bags. Providing washing and cooking facilities of a certain standard.

  • Facilities – landlords must prevent overcrowding and keep shared and communal areas in a good state of repair.

Living in an HMO


Most people who live in a HMO facility enjoy the communal aspect of living well as paying lower living costs than you would renting alone. In general, as there are more people in an HMO property, wear and tear can be more intense for the management company and so repairs and replacements may be required more often. As with a regular property portfolio it’s the landlord’s responsibility to make repairs to electrical wiring, water and gas pipes, fixed heaters, radiators and water heaters, sinks, basins and toilets, as well as the structure of the building itself (walls, gutters, windows etc). Tenants must notify the manager when a repair is required but the smaller repairs – such as changing a light bulb – are things that tenants can do.


HMO licensing


In the Isle of Man HMOs are required to be registered and are subject to a range of regular inspections.


HMO opportunities


We currently have one excellent HMO management business on our website:




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