Single let to HMO

[10101010]

Hi all. We have a few BTLs (single let’s) that give us a decent post tax profit per month but looking for more growth. With the current market we are considering doing work on one of the current rentals (just off an active high street and perfectly located) and moving it into a HMO compared to trying to buy another house and adding to portfolio. However, we keep debating if it’s worth the £ investment to switch it to a HMO so looking for advice. 

house: two double bedroom 
Current rental £950/ month

Yield 6%
 

if we switch to HMO we could go in the attic, two extra double bedrooms and other works to meet HMO requirements (estimate 30k of works). So would turn into four double which would provide £400 per room per month. So total, £1600. 
 

any Logic or formulas anyone applies to switching up to a HMO ? 
 

thanks

[djpix99]

Personally I probably wouldn't go down this route if the rent is only going up £450 per month, the extra monthly outgoings you will have could almost wipe out the extra rent. What I mean is: council tax, energy, water, higher insurance premium, higher mortgage rate, cleaner, higher maintenance...