Social Housing HMOs for Sale

Property Listings: Serco & Mears Leased Properties

These listings show the types of social housing HMOs we regularly help our clients purchase. While these have already sold, similar properties may be available. Speak to a broker for full listing information on current properties for sale.

Leicestershire (SOLD)

Price: £265,000

West Midlands (SOLD)

Price: £230,000

Property: 5-Bed HMO

Annual Rent: £26,500

Net Yield: 10%

Lease: Serco

Lease Length: 7 years

Status: Sold

Property: 4-Bed HMO

Annual Rent: £20,700

Net Yield: 9%

Lease: Serco

Lease Length: 7 years

Status: Sold

Property: 3-Bed HMO

Annual Rent: £16,625

Net Yield: 9.5%

Lease: Serco

Lease Length: 7 years

Status: Sold

Property: 4-Bed HMO

Annual Rent: £12,600

Net Yield: 9%

Lease: Mears

Lease Length: 5 years

Status: Sold

Nottinghamshire (SOLD)

Price: £175,000

County Durham (SOLD)

Price: £140,000

What is a Social Housing HMO?

A social housing HMO is a standard residential HMO (typically 3–5 bedrooms) which has been leased to a registered housing provider under a long-term corporate lease.

These providers use the homes to accommodate vulnerable individuals, including older individuals, those with disabilities or mental health issues, asylum seekers, ex-offenders or those at risk of homelessness, and they take full responsibility for day-to-day property management and the occupants, also known as service users.

The social housing providers which our properties are leased to are often larger corporate organisations such as Serco or Mears.

3 - 5 Beds

7 Years

Typical lease lengths

Typical per property

Why Invest in Social Housing HMOs?

A strategy gaining popularity among buy-to-let investors due to the combination of high rental yields and minimal owner involvement. This approach is increasingly in demand when compared to HMOs rented to working professionals or students. For more information on Social Housing as a buy to let strategy, read our strategy guide here

✅ Fixed Rent, Zero Void Periods

With a corporate lease in place, you receive contracted rent every month, even if the property is empty, your rent is still paid by the provider.

✅ Fully Managed

No letting agent needed. The social housing provider handles:

• Occupant management

• Compliance obligations

• Day-to-day repairs (including tenant damage)

✅ Strong Yields

Average net yields of 9–10%, based on previously sold deals by Seven Generations for properties between £175,000 and £300,000.

Benefits of Social Housing Leases

How Serco and Mears HMO Leases Work
(Social Housing Contracts Explained)

When you invest in one of these properties, you're signing a lease with the housing provider, not the occupant. Which means the rent is paid directly by Serco or Mears, not by individual tenants. The providers require these properties to be used as part of the UK Home Office’s Asylum Accommodation and Support Services Contract (AASC). The lease is a corporate agreement, so it’s more robust than a standard tenancy, i.e. an assured-shorthold tenancy (AST), as well as being for years rather than months. The responsibilities for the upkeep of the property is clearly defined between the owner and provider, the day-to-day repairs, compliance checks, and occupant behaviour are handled by the provider.

We can provide a sample lease on request to help you understand the terms before you proceed with any of the properties we list for sale.

Who Are Serco & Mears?

Serco Group PLC

Serco is a FTSE 250-listed company that delivers a wide range of public services on behalf of government departments in the UK and abroad. One of their key roles is the provision of housing and support for asylum seekers under the Asylum Accommodation and Support Services Contract (AASC) , awarded by the UK Home Office. They are responsible for the accommodation of asylum seekers across the North West, Midlands, and East of England regions.

Under this contract, Serco sources and leases properties—like HMOs—from private landlords and investors to fulfil their housing obligations. These properties are then professionally managed by Serco, with rent paid directly to the landlord via a long-term corporate lease agreement.

🔗 Learn how Serco provides AASC housing under the Home Office Contract

Mears Group

Mears Group is one of the UK’s largest providers of housing and care services to the public and private sector. They are also a Home Office contractor for the Asylum Accommodation and Support Services Contract (AASC) scheme, currently managing asylum accommodation in regions such as Yorkshire and the Humber, North East England, Northern Ireland, and parts of the South West.

As part of the AASC contract, Mears leases residential properties from landlords and investors to provide accommodation for service users. These leases offer investors a stable, predictable rental income via a corporate lease, while Mears handles all aspects of day-to-day management and property compliance.

🔗 Learn how Mears provides AASC housing under the Home Office Contract

These companies are not typical letting agents or housing associations—they are large corporations with direct government contracts, offering a structured and professional approach to social housing provision under a regulated national framework. When you lease your HMO to them, you're entering into an agreement with a corporate tenant, not individual residents.

✅ 7-Year Lease Terms

Properties typically come with a 7-year lease. These leases may include break clauses that can be activated by either party, depending on the terms, which vary by provider. We always recommend reviewing lease terms with a solicitor before purchase.

✅ Hands-Off Ownership

Ideal for investors looking for passive income without the usual hassle of managing an HMO.

Why Invest in Serco & Mears HMOs with Seven Generations

At Seven Generations, we specialise in sourcing and introducing investors to these high-yield, hands-off property opportunities. Here's what makes us different:

Off-Market Access: We’ve built direct relationships with developers and housing providers, so many of our properties are not listed publicly.

Buyer Education: We walk you through the process, including helping you understand leases, compliance, and risks.

Tailored Support: You’ll work with a dedicated broker from enquiry to exchange and beyond—no call centres, no bouncing around.

Suitable for Mortgages: We regularly support buyers using buy to let finance, and can connect you to professionals who understand this model.

Where Are These Properties Located?

We’ve helped investors purchase properties like these across the UK, so it's worth speaking to a broker regardless of your regional preferences. While availability changes regularly, recent Serco and Mears HMOs have been in the following locations.

West Midlands

Close to major cities such as Birmingham, Coventry and Wolverhampton

East Midlands

Close to major cities such as Leicester, Derby & Nottingham

Close to major cities such as Manchester, Liverpool and Preston

North West

North East

Yorkshire & The Humber

South West

Frequently asked questions

Do social housing HMOs have guaranteed rent?

They include contracted rent with a corporate tenant, but they are not legally classed as “guaranteed rent” due to lease break clauses in the contracts with the providers. These clauses vary depending on the provider such as Serco or Mears.

What does the social housing provider cover?

They handle management of the occupants, daily maintenance, and compliance. They also conduct monthly inspections to monitor the condition of the property. You still cover major structural issues and insurance.

What if Serco or Mears ends the lease early?

Each lease includes a clearly defined break clause. If the lease ends early, rent payments stop — but you retain a fully licensed HMO ready to list on the private rental market to professional tenants.

Can I get a mortgage on a HMO leased to Serco or Mears?

Yes, there are mortgage products available for these types of properties although there are not many products currently available in the market. Many of our buyers use buy-to-let mortgages and we can introduce you to the relevant professionals who specialise in this property type.

What happens at the end of the 7-year lease?

Typically, the lease can be renewed or renegotiated depending on the needs of the provider. Alternatively, the property can be re-let or sold on the open market.

Ready to Learn More?

Book a free 15-minute call with one of our property brokers to see live opportunities and ask any questions about how social housing HMOs work