New HMO Planning Regulations – is the Landlord Outrage Justified?

It seems to me that there is a lot of unjustified hysteria about the change to the new planning regulations. I am not a planning lawyer, so I won’t pretend that I know any more than can be read on websites explaining the changes, but I can recognise that there are a lot of people campaigning against the changes who don’t (or chose not to) understand them.

The 2004 Housing Act defined an HMO property as where 3 or more tenants occupied a single property to form two or more households. Local authorities could apply the government to control these HMOs with a local licensing scheme if they so wished, but for property where there were 5 or more tenants living over three or more floors they were required to run a mandatory HMO licensing scheme.

In Planning Law HMOs were specified to be part of  Sui Generis:

Certain uses do not fall within any use class and are considered ‘sui generis’. Such uses include: theatres, houses in multiple occupation …..

My understanding would be that property under Sui Generis would need planning permission to convert to C3 Dwelling Houses defined as:

Use as a dwelling house (whether or not as a sole or main residence) a) for a single person, or people living together as a family or b) by not more than 6 residents living together as a single household (including a household where care is provided for residents) (This class does not include Houses in Multiple Occupation, which provides shared accommodation for more than one household or more than 6 residents).

That understanding seemed shared by the Westminster City Council Planners who in 1998 started enforcement action to stop me renting out my HMO on the basis that I hadn’t applied for planning permission for change of use from a dwelling house. In the end they didn’t follow through in the face of extensive evidence of use as a “Letting House” for many many years – but they did take the view that a change of use from residential to HMO required planning permission. It is possible that they were wrong then, or that something has changed since then, and I have asked specialist lawyers Pain Smith and also Landlord law, but neither felt in a position to comment.

On 6th April 2010 the Planning Laws regarding HMO’s (Homes in Multiple Occupancy) changed, and a new Use Class, ‘C4 Houses in Multiple Occupation’ has been created and will apply to residential property that is to be let to three to six unrelated people, who share amenities such as a kitchen or bathroom. These properties will no longer fall under Sui Generis and conversion from C4 to C3 does not require permission.

The change is not retrospective so properties which have been in use as defined by the new C4 category do not require permission to carry on.

<—- Clicking on the graphic “When do I need Planning Permission” will open what I consider the best explanation of the changes that I have seen, produced by the NLA who are campaigning against the changes

Traditionally under pre-AST tenancy laws HMOs sold at a discount of about 40% to C3 dwelling houses, and one route for developers to make easy profits was to acquire HMOs and convert them to C3 properties. HMOs are of course a very valuable resource for society being pretty much the only supply of affordable housing in the Private Rental Sector (PRS), widely valued by students and low wage workers unable to qualify for council housing. Consequently it is very surprising to find that the bodies representing those with most to gain (Landlords) are campaigning vociferously against the legislation, and that Shelter – the highest profile lobbyist on behalf of the homeless – is silent on the matter.

Nowt so queer as folk.

So when you read statements on high profile authoritative websites from the industry such as:

1. After April 6th 2010 if you want to rent a house to three unrelated people such as nurses sharing, a family with a lodger, students, young professionals, immigrant workers and even the elderly, you will need planning permission.Popularly called Studentification – these new powers will affect any rented property not rented by a family or related group.
2. As of the 6th April, all HMO properties will be required to get planning permission. This brings the definition of HMO for the purposes of planning into line with those used in the Housing Act 2004.
3. These new regulations will not apply to existing HMO properties. However new lets with three or more unrelated people sharing, will require planning consent. The ruling is not retrospective so will not apply to homes already let with an existing tenancy in place, however it will apply to new lets and it is unclear as to whether councils will apply this to renewals.
4. In a nutshell – this impacts all Landlords letting to sharers.
5. The consequences of this law are hideous. If you or I took in a couple of friends as lodgers, we have become a HMO Landlord who requires planning consent.

Don’t automatically believe them! All the above statements are wrong in some way.