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Deal WizardHMO · Property Analysis
5 bedroom terraced house, Valebrooke Avenue, Ashbrooke, Sunderland
Address: Valebrooke Avenue, Ashbrooke, SunderlandPrice: £299,9505 Bedroom(s)2 Bathroom(s)Analysis Date: Jul 7, 2026
ROCE: 14.3 %Tenure Type: FREEHOLDProperty Type: TerracedCouncil Tax Band: CSize: 1400 sq ft / 130 m²Risk: Low-MediumProject Time: 6 weeks

HMO Investment Analysis: Valebrooke Avenue

Analysis for potential investor (User ID: 1776102636017x247235446660021060). Strategy: Buy-to-HMO.

Executive Summary

This is a compelling 5-bedroom, 3-storey terraced property in Ashbrooke, Sunderland, currently listed for £299,950. While marketed as a 5-bedroom home, critical analysis reveals that one room (Bedroom 5) fails the National Minimum Room Size for a single adult (6.51m²). The property effectively functions as a 4-bedroom HMO unless internal reconfigurations are made. The area shows strong rental demand from university students and hospital staff. The investment is viable as a high-quality 4-bedroom professional HMO, but the "5th bedroom" marketing claim should be used as a primary negotiation lever to reduce the acquisition price.

Acquisition Overview

Purchase Price
£299,950
Strategy
HMO
Target Occupancy
4
Council Tax Band
C
EPC Rating
E (55)
Refurb Estimate
£15,000

Projected Rental Income (Post-Refurb)

Monthly Rent (4 Beds)
£2,200
Annual Gross Rent
£26,400
Avg Room Rent
£550

Rent estimated based on comparable ensuite rooms in SR2/SR4 (average £500-£600pcm range).

Projected Cashflow & Returns

ROCE
14.3%
Gross Yield
8.8%
Net Yield
6.5%
Monthly Cash Flow
£485
KPIs assume a 75% LTV mortgage at 1% interest (as provided in parameters) with 25% management/operating expense.

Licensing & Compliance

Status: Not mandatory, but safety standards (fire doors, interlinked alarms) are legally required for all HMO rentals.

Amenity Standards Check:

Property & Layout Analysis

Bedroom 1 (2F)
Size: ~17m² | Status: Valid
Pass
Bedroom 2 (1F)
Size: ~12m² | Status: Valid
Pass
Bedroom 3 (1F)
Size: ~6.0m² | Status: FAIL
Fail
Bedroom 4 (1F)
Size: ~14m² | Status: Valid
Pass
Bedroom 5 (1F)
Size: ~6.0m² | Status: FAIL
Fail

Capacity & Layout Options:

Option 1
4 Bed HMO
Pass
Option 2
5 Bed HMO
Fail

Max Compliant Occupant Count: 4. Do not attempt to let the two smaller rooms as bedrooms; combine or use as studies.

Refurbishment Plan

Refurb Breakdown:

Fire Safety (FD30s, Alarms)£4,500
Room Reconfiguration (B5 & B3)£3,000
Furniture Packages (4 rooms)£3,500
General Decoration/Maintenance£4,000
Total Estimated Cost £15,000

Refurbishment Timeline:

Weeks: 6 || Months: 1.5

Negotiation Points

Undersized Bedrooms
Rooms labeled "Bedroom" in listing are < 6.51m² (National Min). This significantly impacts HMO yield potential.
Probability: 85%
EPC Rating E
EPC is at 55 (E). Costs to upgrade to C are significant. Use as leverage.
Probability: 70%

Investment Case Summary

Short Recommendation

Proceed, but re-price the deal based on a 4-bedroom valuation rather than 5. Excellent location for high-demand professional/student HMOs in Sunderland.

Detailed Recommendation

This is a solid property in a prime Ashbrooke location. The floorplan indicates "Bedroom 3" and "Bedroom 5" are too small to be legally rented as bedrooms for single adults (6.01m² is the typical floor plan scaling check here, which is below the 6.51m² threshold). You should factor this into your offer—you are buying a 4-bed, not a 5-bed. However, the presence of 2 bathrooms and 2 WCs is a huge plus for HMO compliance and tenant desirability. Focus on marketing to professionals working at the nearby Royal Hospital.