This week we are really focusing on HMO’s at NC Real Estate, if you didn’t read my blog ‘A Solution for Investors who are looking for cash flow now’ go read it right now and then check back in here.
So what is Article 4? If you are in the industry you have probably heard of it but don’t quite know what it is or why it is relevant for you.
Permitted development rights allow change of use from a small dwelling house to a small HMO of 3 to 6 bedrooms without the need for planning permission.
(Larger HMO conversions will require planning no matter what)
However, local councils now have the ability to remove this permitted development right where they believe additional HMO’s aren’t necessary under Article 4 of the Town and Country Planning (General Permitted Development) (England) Order 2015
This means that in areas where local councils have implemented this you will need to get planning permission to convert houses into HMO’s which can be a lengthy process.
The good news is that article 4 is not retrospective, so any properties that already have HMO status do not need planning permission – however you will need to continue to update the licensing as it falls due.
Why is this important? For many property managers it’s often been a strategy to advise clients to buy and convert property into HMO’s to improve cash flow. Now this strategy needs more planning.
Rather than fall into the trap of buying up any property that looks like it has spare rooms that could become bedrooms you need to check if it is already license as a HMO or whether the local council has implemented article 4.
It’s not impossible to get planning permission, but if you are looking for a quick turnaround on refurbishment to convert a house into a HMO this could hold you up and become costly with voids.
However now you have the knowledge you can work around this and advise your clients to invest more wisely. To find out if Article 4 has been implemented in an area you are looking to invest in then check out the local councils website or give them a call.
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NC
