The study found that 28% expect to spend more than £10,000, the most common response, while a further 15% plan to spend between £5,001 and £10,000.
Investment has also remained active over the past year. Nearly two thirds, 62%, of HMO landlords said they had improved a property within the past six months, with another 24% carrying out work within the past year.
Looking ahead, 54% said they were extremely likely to make further improvements over the next 12 months, while 18% are already carrying out upgrades.
The work includes decoration, kitchen and bathroom improvements, as well as regulatory and compliance upgrades, safety measures including alarms and fire doors, and energy efficiency improvements.
Paragon's research also found that three quarters of HMO landlords have been letting property for at least 10 years, while more than half cited long term investment as one of their main reasons for entering the HMO market.
Four in five landlords said they intend to either increase or maintain the size of their overall property portfolio over the next 12 months.
The research comes as HMO landlords face higher running costs, regulatory changes and licensing requirements, alongside the impact of interest rates.
Despite these pressures, 82% of those surveyed agreed that HMOs offer better rental yields than other residential letting properties, while 79% said they generate better profitable returns.
Paragon's lending data showed that HMOs generated an average yield of 8.90% during Q2 2026, which the bank said was the highest of any property type it recorded.
Louisa Sedgwick, managing director of mortgages at Paragon Bank, said: "These findings show that many HMO home providers are experienced operators who continue to take a long-term view of the sector. HMOs can be more complex to manage than standard buy-to-let properties, but they remain attractive to landlords who understand the market and have the expertise to operate successfully within it.
"What stands out is that landlords are continuing to invest as standards, costs and regulation evolve. The level of planned expenditure suggests that many are focused on maintaining quality, supporting compliance and ensuring their properties remain well positioned over the long term."
