What is a HMO Mortgage in Cardiff?

If you’re planning to rent out a property to multiple tenants who aren’t part of the same household, you may need a HMO mortgage.

In Cardiff, this type of mortgage is commonly used by landlords who want to let to students, young professionals, or shared tenants.

Not all buy to let mortgages cover this setup, so understanding how HMO mortgages work, and how they differ from standard buy to let, is key if you’re thinking of investing in this kind of property.

What is a HMO mortgage in Cardiff?

If you’re planning to let out a property to multiple tenants who live independently under one roof, you may need a HMO mortgage.

These types of mortgages are often used by landlords renting to students or young professionals sharing a home. A HMO (House in Multiple Occupation) setup differs from a standard single-tenancy let, which means most lenders treat it differently when it comes to mortgage applications.

Not all buy to let lenders accept HMO properties, so it’s important to understand how this type of mortgage works before making an offer or converting an existing property.

What counts as a HMO property?

A HMO is typically a property rented out by at least three people who are not part of the same household but share facilities such as a kitchen or bathroom.

In other words, the tenants live independently, with separate tenancy agreements, but share communal spaces.

Some HMOs are smaller shared houses, while others are larger buildings split into multiple rooms or units.

If a property is let to five or more people forming more than one household, it’s classed as a large HMO and may be subject to additional licensing rules.

When do you need A HMO mortgage?

If your tenants will be unrelated and renting rooms individually, you’ll usually need a specific HMO mortgage.

A standard buy to let mortgage in Cardiff is often only suitable for single-family lets or joint tenancy agreements.

Trying to use a standard buy to let product for a HMO property without declaring it could breach your mortgage terms.

Lenders will assess the risks differently, and they’ll want to know upfront how the property is being used. That’s why it’s so important to apply for the correct mortgage type from the start.

Do you need a HMO licence in Cardiff?

Yes, in many cases you do. Cardiff Council requires landlords to hold a HMO licence if they let a property to three or more people who form two or more households. This includes student lets, shared houses and bedsits.

If you’re unsure whether the property you’re buying needs a HMO licence, it’s worth checking with Cardiff Council directly. Without the correct licence in place, you could face penalties and may find it harder to secure mortgage funding.

How does a HMO mortgage work?

A HMO mortgage works similarly to a standard buy to let mortgage in Cardiff, but the lender will carry out more detailed checks.

They’ll want to know how the property is laid out, how many lettable rooms there are, and whether it meets local licensing requirements.

Lenders may also want to see your rental projections and confirm that the property complies with fire safety and building regulations.

Because HMOs are seen as higher risk, lenders often apply stricter criteria, but there are still a range of competitive products available if the property is managed properly.

What are the requirements for a HMO mortgage?

Each lender will have their own rules, but there are a few common requirements.

You’ll usually need a larger deposit, often 25% or more, and may be asked to show experience as a landlord, especially for larger HMOs.

Lenders will also look at the property’s expected rental income and how it stacks up against the mortgage payments.

Some will only lend on properties with a certain number of lettable rooms, or those that meet a specific standard in terms of layout and safety features.

Speak to a Mortgage Advisor in Cardiff

Whether you’re buying your first investment property or expanding your portfolio, getting the right mortgage for a HMO in Cardiff starts with expert advice.

As a mortgage broker in Cardiff, we have experience helping landlords secure HMO mortgages that suit their plans, from student lets near the universities to shared houses in the surrounding suburbs.

If you’re unsure about licensing, affordability, or which lenders accept your property type, we’re here to help you find a way forward.

Date Last Edited: August 22, 2025