Specialising in Small and Large HMO Mortgages

A new and improved range for properties large and small

We already provide a comprehensive array of buy to let mortgages for a wide variety of landlords. With our new and improved Houses in Multiple Occupation (HMO) range, we’ve built upon that expertise to offer even more.

So what is an HMO?

Before we start, let’s define a House in Multiple Occupation. An HMO is a ‘house share’ property let to several tenants who aren’t members of the same family.

For extra clarity, here’s how YouGov.co.uk describe an HMO: a property let to at least three tenants who form more than one household. They also share bathroom, kitchen or toilet facilities with other tenants.

Enhanced criteria for wider appeal

We’ve improved our qualification criteria to open up HMO to even more of your clients:

  • Higher LTV: we’ve increased the LTV for HMOs to 75%, meaning your clients have access to greater purchasing power
  • Increased maximum loan size: a maximum loan size of £750,000 reflects the fact these types of properties tend to be more expensive
  • Interest Coverage Ratio: to account for increased property maintenance, running and management costs, the minimum ICR on HMO properties is now 165%
  • Number of bedrooms: by increasing the upper limit of bedrooms to eight, we help HMO landlords access a greater range of properties with multiple occupancy potential
  • Availability: our HMO mortgages are available in England, Scotland and Wales

What makes an HMO large or small?

There are a number of ways to define whether an HMO is large or small. For instance, the number of bedrooms, licencing or the number of occupants can all be used.

At Leeds Building Society we use the number of occupants. This way, we can ensure the right type of valuation is undertaken to meet the individual needs for each property type.

Key differences at a glance

Small HMO


Housing up to and including 6 occupants


Large HMO


Housing more than 6 occupants.


There is a maximum of 8 bedrooms for both Small and Large HMO properties.


A property has 6 bedrooms. If it has 6 occupants it will be classed as a Small HMO. However, if it has 8 occupants it will be classed as Large HMO.

Occupancy will be independently verified by the Society’s specialist valuer. Where a mandatory licence exists, the licence will be used to determine maximum occupancy whereby you will need to apply the maximum occupancy as detailed on the licence. An occupant is defined as an individual person who resides in the property.

Tailor-made valuations

When calculating the rental value of an HMO – whether it’s large or small – the valuer will base the figure on 100% occupancy of lettable rooms.

What’s more, to accurately reflect the specific nature of an HMO property, all valuations will be undertaken by a specialist valuer.

Our Large HMO valuations are commercial and yield-based. That way, we can match the property’s open market value to your client’s potential investment return. The valuation of small HMOs, however, will be calculated on a comparable basis as a standard buy to let.

Your choice of HMO product drives our type of valuation

To underwrite your application we need to carry out the appropriate valuation. This is based on whether you select a Small HMO or a Large HMO product when you apply. For us to underwrite your applications, it’s really important for you to carefully consider all criteria before making your choice.

Remember the number of occupants is the key thing to consider. If you’re at all unsure, talk to your BDM before you make your selection.

Expert help at every step

More than most, we know what it takes to support you and your clients’ with complex property types such as HMO. That’s why with Leeds Building Society, you can count on specialist help at every step:

  • Our underwriters are specially trained to deal with high value HMO mortgages. By treating each application on its own merits they’re able to deliver the best client outcome and a smooth end-to-end process
  • Our valuers assess an HMO property’s market and rental values based on 100% occupancy of all lettable rooms. This way the valuation fully reflects the property’s income potential, which in turn boosts your client’s borrowing potential
  • Our BDMs are always on hand to guide clients through the application process and HMO product range.

Get to know HMO

To see how our new mortgage range is set to meet a growing need amongst landlords and investors, take a look at our video and get to know HMO a little better.

You can see our full product range in more detail here and you can view our HMO lending criteria here.

A straightforward application process

You can start your application right here or contact your BDM for any extra support or guidance you might need.

Please note:

Leeds Building Society only accepts mortgage applications from intermediaries where they are providing an advised sales service, with the exception of Buy to Let & Holiday Let applications. It is the responsibility of the intermediary to ensure that all applicable law including, without limitation, the Financial Conduct Authority rules on advised mortgage sales are complied with including, without limitation, the provision of adequate explanations.