Managing an HMO; rooms, part-lets and shared costs

An HMO is one property with several separate lettings inside it. RentalBux handles it as room-level tracking on a single property record, so you can see both the whole house and each room.

Setting it up

1. Add the property and set its type to HMO.

2. Add each room.

3. Add a tenancy per room, with its own rent and dates.

Rent

Each room’s rent is tracked separately, so a void room shows as a void room rather than quietly reducing the whole property’s income. The property total is the sum of the rooms.

Shared costs

Utilities, cleaning, broadband and council tax usually cover the whole house. Record them against the property, not a room — the property-level figure is what reaches your tax figures either way, and splitting a gas bill five ways buys you nothing at submission time.

Common questions

• Bills-included rents. Record the full rent as income and the bills as expenses. Netting them off understates both.

• A room let mid-month. Record the tenancy from the actual start date; the rent follows the dates you set.

• Licensing. Store the licence in Documents against the property with its expiry date. Whether you need one is a legal question for UKPA.

Worked example

A five-bed HMO. Four rooms let at £520.00, one empty since June. Monthly electricity £180.00, gas £145.00, broadband £32.00, council tax £160.00, cleaning £120.00. Rent is tracked per room, so the void is visible; costs are recorded against the property, because they are the property’s costs whether four rooms or five are occupied. Profit for the month is calculated from both.

Why not split the bills by room

Because it adds work and changes nothing that matters. The property-level total is what reaches your tax figures, and a utility bill is not more allowable for being divided by five. Split by room only if you genuinely recharge tenants individually.

Void rooms

Leave the room empty in the record rather than reducing the rent on the others. A void is information: it tells you what the vacancy is costing and how long it has run. Backfilling the gap to make the property look full removes the only signal you had.

Common questions

• Can rooms have different rents? Yes, and they usually should — the front double is not the box room.

• A tenant moving between rooms. End one room tenancy and start another. The history stays on both rooms.

• Communal areas. Costs sit at property level; there is nothing to allocate.

The room view is the reason to record an HMO properly. Occupancy at property level says “mostly full”; occupancy per room says room 4 has been empty for eleven weeks and has cost you £1,430.00.