HMO conversions cost more than £82,000 on average
The average cost of converting a property into a house in multiple occupation (HMO) is estimated at £82,084 across England, research from Rushbrook has found.
The property management firm estimated that converting a property costs £15,275 per bedroom, based on an average HMO size of 5.37 bedrooms.
London had the highest estimated conversion cost at £92,796, followed by the South East at £90,552 and the South West at £89,737.
At the other end of the scale, the estimated cost was lowest in the North East at £70,955, followed by the North West at £73,076 and the East Midlands at £74,485.
When the purchase price of an eligible three- or four-bedroom property was included, the average estimated cost of buying and converting a property into an HMO rose to £531,882.
This comprised an estimated purchase price of £449,798 and conversion costs of £82,084.
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The estimated total investment was highest in London at £957,105, followed by the South East at £630,333 and the East of England at £557,416.
Roma Sharma, managing director of Rushbrook, said: “Converting a property into an HMO is a substantial financial undertaking, and the conversion costs alone can represent a significant investment before landlords have even factored in the cost of purchasing the property.
“For those who would rather avoid undertaking a conversion, there is an established market of licensed HMOs available to purchase. However, buying an existing property doesn’t necessarily mean it will require no further work or investment, and landlords still need to carry out the appropriate due diligence.”
