HMO Rentals

If you've a three bed house, you'll make more money renting it to three single lads than you will to a family with three kids. The potential income is usually higher & the wear and tear (avoiding kids) is usually lower. The downside is the higher turnover of tenants as families with kids tend to be more stable than young professionals - there's an increased potential for lost rent for vacant periods. It's not exactly worth spending £5k to turn it in to a HMO in order to get 3x£300 per month instead of £800 from a family, if each of the rooms is empty for two months every summer. You can avoid that a little with individual twelve month leases & deposits, but it's still no guarantee you won't find yourself with empty rooms. Plus, if the individual tenants don't get on, it can be a pain in the hole to remove one and you'll end up having to take sides.

There are better pensions than it, anyway. It definitely takes a fair bit more managing than simply renting the whole house as one unit; you have to work to earn the extra rent. It's natural though: three tenants definitely require more interaction than one tenant, even if they are in the same house.