Revealed: The most lucrative shared living postcodes

New research from COHO, the HMO management platform, reveals that the shared living market in England & Wales generates an estimated monthly rental income of £1.4bn.

But which postcode areas are creating the most income from shared living?

COHO has analysed the estimated number of licensed HMO properties in England & Wales, and the average monthly HMO rental income per room to calculate the overall value of the shared living market based on an average property having five bedrooms.

The average monthly rent price of a room in a shared living property in England & Wales sits at an estimated £711.

For a property with five bedrooms, this equates to a total estimated monthly income of £3,557 per property.

Further analysis shows that there are 394,945 licenced HMOs in England & Wales, which means the sector’s total monthly rental income surpasses £1.4bn.

London’s HMO market alone generates monthly income of £918.4m, followed by the South East (£140.5m), the South West (£106.8m), North West (£60), and Yorkshire & Humber (£56.4).

Where are the most lucrative HMO postcode areas?

With by far the nation’s largest and most lucrative shared living market, it’s no surprise that London dominates when it comes to the list of most valuable postcodes.

At the top of the list is NW1, where 9,681 shared living properties charge an average monthly rent of £1,220 per room, creating a total monthly income of more than £59m.

East London’s E5 postcode is the busiest house share postcode in the country, with an estimated total of more than 12,061 licenced HMOs. At an average monthly rent of £949 per room, E5’s total shared living income sits at more than £57.2m per month.

Other leading London postcodes include SE1 (£42.7m), N15 (£37.3m), IG1 (£36.1m), EN3 (£30m), N17 (£28.5m), and IG3 (£27.6m).

Outside the capital, the most lucrative HMO market is found in Bristol, where the BS16 postcode area houses 6,908 shared living properties combining for a total monthly income of over £25m.

Other leading non-London postcodes include York’s YO10 (£10.6m), Brighton’s BN2 (£8.7m), Bath’s BA2 (£8.5m), Cardiff’s CF24 (£8.2m), Oxford’s OX4 (£6.8m), Leeds’ LS6 (£6.4m), and Manchester’s M14 (£5.7m).

COHO Founder and CEO, Vann Vogstad, said, “The numbers speak for themselves: over £1.4bn in monthly rental income from nearly 400,000 licenced HMOs across England and Wales the shared living sector is a housing market heavyweight.

What was once seen as the preserve of students and transient renters has evolved into one of the most lucrative and dynamic sectors of the UK market.

This evolution is being driven by a new generation of renters,  most notably young professionals at the beginning of their careers who are showing a great appetite for the social and community benefits provided by shared living, while also craving a high quality, sophisticated home.

As the shared living demographic broadens and becomes more discerning, the sector’s revenue potential goes through the roof. Our own previous research has already proven that tenants will pay more to live in good quality homes with well-matched housemates, and the future scope for further value is limited only by the landlord’s creativity and ability to provide a rental experience above and beyond the rest of the market.”