Housetrix research · September 2026
High rental yields, tighter HMO rules
The places where rental income is strongest are the places most likely to have restricted HMO conversions. 19 of England's 50 highest-yield councils (38%) have Article 4 areas restricting HMOs in the national planning dataset, against 0 of the 50 lowest-yield councils. Across all 294 English councils, 45 (15%) have one.
38%
of the top 50 yield councils restrict HMOs
0%
of the bottom 50 yield councils do
5.0% vs 4.4%
median yield, councils with HMO restrictions vs without
The pattern, band by band
English councils sorted by average gross rental yield, split into bands.
The top 20 by yield
7 of England's 20 highest-yield councils have HMO Article 4 areas recorded. Each name links to that area's page.
Why it matters
For investors: the high-yield areas that look best on paper for a house-share are exactly where councils are most likely to require full planning permission to create one. A yield figure alone never tells you whether an HMO conversion is allowed on a given street.
For councils and residents: HMO restrictions cluster where cheaper housing meets strong rental demand, which is where conversions have been most concentrated.
The honest limits: this shows the two patterns overlap, not that one causes the other. The national dataset only holds what councils publish (the NRLA estimates 75 to 80 councils use HMO directions; 45 appear here). Nottingham, Portsmouth and Manchester all restrict HMO conversions citywide but have no Article 4 records in the dataset at all, so every share on this page is a minimum. Yields are council-wide averages across all property types.
Check a specific street
Search any English postcode to see whether it sits in an Article 4 area and what that area restricts.
Methodology and how to cite
Yields: average gross rental yield for each English local authority, from HM Land Registry UK HPI average prices (July 2026) and ONS Price Index of Private Rents (August 2026), as published on rental yields by area. HMO restrictions: Article 4 direction areas from planning.data.gov.uk classified as restricting HMO conversions (GPDO Part 3 Class L, or HMO wording in the record), as described in the Article 4 report. A council counts if it has at least one such area.
Cite as: “Housetrix, High rental yields, tighter HMO rules, September 2026”, with a link to this page. Council-level table for every English council: CSV or JSON. Free to reuse with attribution.