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New Planning Categories for HMOs

We have previously reported that the Government was planning to amend the Town and Country Planning (Use Classes) Order 1987 to create a separate planning class for HMOs. The changes will come into force on 6 April 2010. The changes will only apply to England as Wales has its own devolved powers to deal with these matters.

The statutory instrument to carry out this change has just been published on the OPSI website as the The Town and Country Planning (Use Classes) (Amendment) (England) Order 2010.

The new planning classes will be as follows:
Class C3 has been amended to cover single households of up to six occupiers.
A new class C4 has been created which will cover HMOs of up to six people.
Properties with more than six occupiers will continue to be outside any planning category.

These changes will bring the definition of HMO for the purposes of planning in line with those used in the Housing Act 2004. The upshot of this issue is that any property which is an HMO (irrespective of whether it requires a licence) will now need to have a separate planning approval. The government has previously stated that they do not consider that this applies to tenancies which are currently in place as at 6 April but will presumably an application will need to be made on renewal. However, it is not clear how local authorities will view this area.

This will undoubtedly cause a massive increase in the number of planning applications and therefore the number of appeals. This will therefore mean yet another increase in cost to landlords and the amount of paperwork. Inevitably, many landlords will simply decline to let to sharers to avoid the hassle.

44 Comments

  • Mark 15th March 2010 at 12:04 pm

    Hmmmmmmmm We have 140 student properties pre-booked for the next academic year. If clients apply for planning permission and it is denied, the appeal time might mean that there are thousands of homeless students until nearly Christmas time!!
    Seriously though, should we be advising clients not to sign agreements until we have planning permission?

    • PainSmith 15th March 2010 at 12:07 pm

      This is a serious problem and it is hard to give you a definitive answer. You should certainly be talking to the local planning officer to see what their view of your planning applications might be.

  • Luticha 15th March 2010 at 2:59 pm

    who’s responsible for applying..landlord or agent…if landlord do we need to see evidence of permission before we can let….does permission have to be granted before a tenancy commences

    • PainSmith 15th March 2010 at 3:23 pm

      It is up to the landlord to seek planning permission although he may be grateful for assistance from his agent. You do not have to see evidence of planning consent although it would certainly be a good idea. Technically, permission does have to be granted before the start of the tenancy but it is up to each local planning authority as to how aggressive they are over enforcing this.

  • Phil 15th March 2010 at 5:39 pm

    Surely they cannot enforce the re-application for planning permission?

    They would be using the planning laws as a means of licensing, which is not what they are for.

    Planning permission is sought to alter the category, not to keep an existing category?

    I’m not sure how enforceable it would be in law.

    • PainSmith 15th March 2010 at 6:22 pm

      Not sure quite what you mean by ‘re-application’. If you mean a change from HMO use to single family use then yes this can be enforced because it is a change of category and therefore a material change of use. It is fully enforceable in law.
      This is not a replacement for HMO licensing but a supplement designed to deal with the fact that an HMO licence cannot be refused on the grounds that there are lots of other HMOs in the same area. It does however have the annoying side effect of potentially allowing a great many extra standards and obligations that are not currently grounds fror rejecting a licence to be added into an HMO licence appliction.

  • Himesh 15th March 2010 at 8:42 pm

    I think Phil was questioning whether we would have to renew an application for planning permission every time new tenants were to lease the property? Would this be the case?

    Also it was my understanding that to go from a class 4 back to class 3, we would require no further planning applications

  • Ben 15th March 2010 at 10:03 pm

    I believe Phil is refering to the potential that plannig permission may be required upon renewal of the AST as mentioned in your article above.

    I share Phils concern, if this the case there will be a large number of houses that fall ino the “planning” trap. I suspect there will be some very interesting appeal cases as landlords challenge what is effectivly retospective application of the legislation.

    Additionally, for those who already have tennants for next year, as I have, I would suggest that no local authority will allow studens to be evicted, especially if the media become involved.

    • PainSmith 15th March 2010 at 11:22 pm

      We apologise for the confusion. There is no need to renew permission on each renewal of tenancy. The article is referring to the fact that the government has said that no permission is needed on 6 April for tenancies that are already in place but we presume that if tenancies in place on 6 April are later renewed then permission will be needed at that stage.

      Given that the government has already said that there will be no change for those who already have tenancies in place we doubt there will be any problems of students being evicted.

      The main issue lies with landlords who have undertaken expensive conversions in order to be able to obtain an HMO licence and now find themselves unable to obtain the necessary planning permission to make use of that licence. This is manifestly unfair and wrong.

      We do not know what the position will be in moveing from C4 to C3. The government has not made any comment.

  • Phil 16th March 2010 at 9:32 am

    It is implied at the following link that going from a C4 to C3 will not require planning permission.

    http://www.planningportal.gov.uk/england/government/news/archive/2010/jan/2010-01-week-4/280110_1

    My understanding that ‘tenancies already in place’ does not cater for those people who already have signed AST’s commencing post 6 April 2010, and that the house must be ‘occupied’ on 6 April 2010 to gain the C4 category. Some people who have developed HMO’s and have them ready for the summer, for which they have signed AST’s with tenants may still not get planning permission. That is from guidance from my local council.

    Are you saying that in this situation, the tenancy would be allowed to go on, as the AST is in place, but after the termination of that specific tenancy they would need to apply for planning permission?

    • PainSmith 16th March 2010 at 11:08 am

      The legislation does not make any allowance for tenancies already in place nor does it say that there is no need to apply for consent to shift from C4 to C3 use. This is a matter for government guidance and local authorities. We do not see how a local authority can draw a distinction between a tenancy that has been signed where occupation has yet to be taken up and one where it has. The landlord has no ability to terminate either arrangement irrespective of planning issues.

  • Phil 16th March 2010 at 11:35 am

    This is a direct quote from a pre-planning application…

    “Therefore the answer to your question is:

    If the property will be occupied as under the current C3 (Dwelling) as above prior to 6 April 2010 then Planning permission would not be required. An you are advised to retain all evidence to prove that this is the case.

    If the property is not occupied by three or more people (who are not all members of the same family) share a bathroom, kitchen and toilet until after 6 April 2010 then planning permission will be required and may not always be forthcoming, even if the contract for the let is being signed prior to 6 April 2010.”

  • Phil 16th March 2010 at 12:32 pm

    I suspect the same with respect to contesting the interpretation.

    To clarify your point:

    “The article is referring to the fact that the government has said that no permission is needed on 6 April for tenancies that are already in place but we presume that if tenancies in place on 6 April are later renewed then permission will be needed at that stage.”

    You are referring to those who are not presently HMO’s but do have AST’s in place to commence being an HMO post 6 April. You’re suggesting they will need to apply for planning permission once the tenancy ends.

    But for HMO’s from pre 6 April 2010, you suspect that they will not have to apply for planning permission at the end of their current tenancy and the start of a new?

    • PainSmith 16th March 2010 at 6:23 pm

      No. We are suggesting that existing tenancies that are to be HMOs which have been validly enetered into before 6 April will not need to make a planning application to change to C4 status until they are renewed. We do not see that the date of occupation should make any difference and consider that a local authority drawing a distinction between the two situations is incorrect to do so as, from the point of view of the landlord’s ability to end the tenancy, the fact of occupation is irrelevant.

  • jennifer 17th March 2010 at 2:27 pm

    If a property is currently occupied by 3 or more sharers isn’t the Class 4 an established use?

  • jennifer 17th March 2010 at 2:33 pm

    If a property is currently occupied by 3 or more sharers isn’t Class 4 an established use whuch will continue if the next tenants are also sharers?

    • PainSmith 18th March 2010 at 10:25 am

      You can only obtain established use by acting outside an approved planning status for an extended period of time. Currently people letting to three or more sharers are not acting outide any planning status, they are acting within the C3 class. On 6 April the C3 class is being subdivided into a residual C3 class and a new C4 class. At that stage people will have to choose between the two. If someone continued to act after 6 April within the C4 class without gaining planning consent and without objection by the local authority then after a period of time that individual would gain C4 status by default but you cannot start the clock running before that point.

  • Mark 19th March 2010 at 11:41 am

    I have had a word with my (very good) planning consultant….. He seems to think that the most likely mechanism for actioning the statutory instrument will be for local planning officers to grant a certificate of lawful use on existing HMOs.
    If Environmental health co-ordinate, there may be room to require “self certification” of properties in relation to HHSRS compliance.
    He points out one or two interesting potential anomalies, one on the apparent poor drafting of the instrument which would appear to leave a loophole…….. There is no apparent definition of “single household” for part 3 (c) of the instrument……. The interpretation seems to only relate to 3(a).
    The other interesting point for clarification is what will happen if a property that has been certificated for HMO use is let to a family (no permissions required) but subsequently is then let to sharers again…….will permission be required to revert back to HMO use?

  • jennifer 21st March 2010 at 2:13 pm

    The March 2010 impact assessment states a change of use from an HMO to C3 will be permitted development and not require planning permission, and that a change back to C4 will only be necessary if HMO use has not been extinguished.

    The various government documents refer only to new HMOs requiring planning permission to me and presuppose existing HMOs won’t need planning permission. The impact assessment anticipates an average additional 8,500 planning applications a year and as they assume a stock of 400,000 this surely means planning applications don’t need to be made on every change of tenants. They also refer to the cost of planning application being a ‘one-off’ cost for a landlord.

  • PainSmith 21st March 2010 at 10:33 pm

    This new impact assessment was published on 18 March. The ability to change from C4 to C3 use without consent is permitted by the changes made in the The Town and Country Planning (General Permitted Development) (Amendment) (England) Order 2010.

  • Phil 22nd March 2010 at 11:05 pm

    Mark: Agree with Jennifer…The impact assessment of 18 March says that if a HMO changes to C3 as a result of a family let, then “that planning permission will endure even if there is a temporary reversion to C3″. (Para 29)

    I agree with Jennifer, that the impact assessment clearly indicates that a re-application is not need on each change of tenants. Conclusions drawn from same evidence…”one-off cost” and “8,500” planning applications.

    What the impact assessment doesn’t address is about “accidental HMO’s”. i.e. Young professional buys a property and supports their mortgage to two co-workers / other young professionals. That is an HMO, but will they know to apply for planning….doubt it.

    Also, what if three people buy a house together to live in. They have to seek planning permission?!

  • Simon 23rd March 2010 at 9:09 am

    My understanding was that the definition of an HMO proposed by s.254 of the Housing Act would exclude properties which are occupied by one or more persons who have, whether in whole or in part, either the freehold estate of a leasehold interest for a term of more than 21 years, or any member of the household of such persons (See Schedule 14 of the Act). So a house bought by 3 people to live in cannot be a Class C4 HMO. Although I suppose it might fall under C3(c).

    I hope the DCLG will produce further documentation clarifying the matter (they have suggested that the current circular on Use Classes will be amended) but guidance on the matter is lacking so far. It will be interesting to see how LPA’s interpret the new rules.

  • Nick 23rd March 2010 at 2:00 pm

    I’m slightly puzzled because in 1998 my local authority started enforcement action to stop me renting out my HMO. In the end they didn’t follow through, but they took the view that a change of use from residential to HMO required planning permission. Were they wrong then or has something changed since then? If they were right then, surely the new rules actually relax the situation as it allows HMOs to convert to residential use without planning permission which is potentially very profitable for developers!

  • Ben 23rd March 2010 at 10:51 pm

    Simon,

    You raise an interesting point. I had a re-read of the legislation after reading your post, s.254 refers to Schedule 14 of the act, para 6:

    (1) Any building which is occupied ONLY by persons within the following paragraphs—

    (a) one or more persons who have, whether in the whole or any part of it, either the freehold estate or a leasehold interest granted for a term of more than 21 years;

    My interpretation of this is that under the scenario of “Accidental HMO’s” Phil suggests above, i.e. a single owner, renting to 2 or more unconnected friends will indeed require planning permission? Any thoughts would be appreciated.

  • Simon 24th March 2010 at 11:52 am

    Ben

    My view (and I am not a solicitor by trade) is that an HMO must have more than 2 occupants (Schedule 14 Para. 7 provides for this) but if a single owner decided to rent to 3 or more unconnected friends, this might indeed inadvertently become an HMO, unless the owner remained in occupation.

    • PainSmith 24th March 2010 at 11:59 am

      The Government has made clear by guidance that it considers that having 2 lodgers does not make a property an HMO but having 3 does.

  • Eric Walker 14th April 2010 at 10:59 am

    This is insane. IF they want to impose this planning criteria to prevent ‘Studentifaction’ of properties, it should be in one direction only. It should work like commercial planning uses where you need planning to move from A4 – A1, but not in the other direction.

    In other words, if your established use is to rent to 2 people, you need consent to rent to 6. However once this is received, you wouldn’t need to consent to rent to 3 people the following year.

    David Cameron has lodged an EDM to repeal this law.

    • PainSmith 14th April 2010 at 7:15 pm

      It does work in one direction. No permission is needed to move from C4 to C3 use.

  • tony 14th April 2010 at 6:32 pm

    Do I need planning permission to let a house to 7 students sharing on a joint tenancy?

  • PainSmith 14th April 2010 at 7:12 pm

    Yes

  • phil t 16th April 2010 at 12:08 pm

    hi
    as a student landlord in newcastle with 12 6/7 bed licenced hmos i have been looking carefully at this new legislation. in newcastle the planners have been following up many 7 bed hmo licence applications with a visit to the property after serving notice that planning change of use required to change from dwelling to hmo. other landlords also had same planning contravention notices, and listed on planning portal website as being in breach of planning. All of the enforcement notices were withdrawn following visits to the properties to see if there were a “material change in use” from a family house, using one reception room as bedroom, keeping a shred lounge and kitchen, havibg shared tenancy agreements with whole group moving in together and sharing bills seemed to be reasons for classing group as living as a SINGLE household C3. the new legislation appears only have amended this to alter the group six from more than 6 to 3 or more, but it is still subject to condition that there must be a “material change in use”. so 3 people on shared tenancy with shared kitchen and lounge would still constitute a SINGLE household.

    Class C3. Dwellinghouses

    Use as a dwellinghouse (whether or not as a sole or main residence) by—

    (a) a single person or by people to be regarded as forming a single household;

    I would suggest if any one has any concerns to ring their local planners and ask what constitutes a single household- shared tenancies and facilities are key. HMOS are on single tenancy agreements or where no shared lounge/kitchen.

    • PainSmith 16th April 2010 at 1:00 pm

      Unfortunately you are not correct. The old class system had no definition of household and so the manner in which the tenants were living was relevant. The new system defines household int he same manner as the Housing Act 2004. Therefore if your property is an HMO for Housing Act 2004 purposes then you will also need planning permission.

  • Tony Athill 16th April 2010 at 5:35 pm

    It is fairly clear what constitutes a Class 4 HMO. It is also clear that only newly created HMOs will need planning permission. It looks like all newly created HMOs will need planning permission. BUT the impact assessment refers to some new HMOs not requiring planning permission because they are not considered to be a material change of use. Under what circumstances will a new HMO not require planning permission? This seams to be left up to the local authority but when might they say yes it’s a new HMO but you don’t need planning permission?

  • robin sehgal 22nd April 2010 at 8:37 am

    What would be the position if you were in the process of building accomodation for 6 unrelated people for them to move in in Sept 10 and Contract and deposits were taken prior to April 6?

  • phil 23rd April 2010 at 1:18 pm

    Robin, local planners have said in that case it would need to be “occupied” prior to 6 April 2010.

    See the posts on here from 16 March.

    Painsmith believe there may be scope to challenge the position if planning was refused.

    There does not appear to be direct guidance on the matter.

  • Joanna Sayer 26th April 2010 at 2:53 pm

    Hi.

    I recently put in a planning application for a Change of Use on one of my HMO properties. I have just got notice that the council are refusing my application. Can they do this if the property was a HMO prior to 6th April 2010 when the new planning legislation came into force.

    What will happen with regard to my tenants – do I have to evict them?

    I do plan on appealing – the current tenancies expire on 31/7/10. Can I legally sign new contract with HMO planning approval

    • PainSmith 26th April 2010 at 2:58 pm

      The position is unclear on your question. Having made the application the planning authority is entitled to refuse it but they may be persuaded to let you see out the current tenancy on the basis that you could have done this without making the application in the first place.

      You can sign a new contract and it will be binding on both you and the tenants but the local planning authority will be able to take enforcement action against you for a breach of planning consent.

  • David 26th April 2010 at 6:01 pm

    Hi,

    I have a house which I purchased from Nottingham University in Sept 2006.
    I used to let it out to 3 sharers. When there AST’s ended in September 2009 they moved out and I started work on the house, changing it to a three storey, 6 bed house.
    The building work was finished and signed off by building control on the 3rd May 2010.
    My question is do I send in an application for a lawfull development certificate for a proposed use or do I need to apply for planning? I hope I can use the lawfull developmemt because the planners are not giving permission for new HMO’s in Nottingham.
    What do you think?
    Regards,
    David.

  • Mike 17th May 2010 at 8:20 pm

    I have 3 x 5 bed semis all 2 story which I let as HMO although HMO licencing does not apply due to them only being 2 story. I let on individual tenancies to young professionals.

    I do not think the new planning legislation provides any threat to my activities as all were established HMO’s before the April 6th deadline.

    A number of interesting questions cross my mind.

    1/ at the head of this thead you state that:-
    “Class C3 has been amended to cover single households of up to six occupiers.

    A new class C4 has been created which will cover HMOs of up to six people.

    Properties with more than six occupiers will continue to be outside any planning category.”

    So, a single household be it up to and including 6 or or more than 6 needs no planning consent. And a new HMO of 3,4,5 or 6 sharers will need change of use to C4. But what about where more thann 6 have been sharing, these “continue to be outside any planning category” what does that mean?

    2/ I let on a room by room basis on individual AST’s. Tenants come and tenants go, there is never such a thing as a renewal. Can I continue on this basis without ever applying for C4?

    3/ I have another larger house (6 bed plus potential dependant relative accommodation) which was let to a family but when they vacated I refurbished it and since February it has been let to a number of Latvian imigrant workers, the number increasing as individual rooms became finished. I now have 2 couples, 2 singles and a child, 2 more children arrive in June.

    At the risk of getting long winded let me paint 2 alternative letting scenarios for this house.

    A/ I let to a Dr and Mrs Smith. They have 4 children. Graciously they have allowed the boyfriend of thier eldest daughter to cohabit with her and at the request of thier frends who have emigrated they have agreed to accommodate thier godson for 2 years whilst he finishes his education. In addittion Mrs Smiths mother and partner of several years (not married)also live with them. Mrs smith is assisted in her houshold duties by a live in au-pair.
    My house is ideal for them if the use the dining room as a bedroom they can easily accomodate 3 couples and 4 singles, 10 people in total. I let to Dr & Mrs Smith on an AST, they will occupy the house initially with their 2 youngest children, the au-pair returns from Sweden i 3 months, another daughter and the godson come home from Uni in 4 months, the eldest daughter and boyfrend return from thier gap year in 6 months and the elderly parent and partner ae selling thier place and will probably arrive in 9 months. Because Dr Smith is a good negotiator and good tenants for such a large house are hard to come by, I have done him a deal wherebuy the rent increases in direct proportion to the number of people occupying the house, knowing that eventually it will be full and I will get a good rent. Is this a single household or an HMO for planning and/or licencing (3 storys)?

    B/ I let to a Latvian Mr Riga and his mother who are over here looking for work and to establish a base to bring the rest of his family to. After 2 months his wife and child arrive shortly followed by his 2 brothers a wife and friend. Some months later his brother brings over his 2 children. My house is ideal for them if the use the dining room as a bedroom they can easily accomodate 2 couples and 6 singles, 10 people in total. I let to Mr & Mrs Riga on an AST Because he is a good negotiator and good tenants for such a large house are hard to come by, I have done him a deal wherebut the rent increases in direct proportion to the number of people occupying the house, knowing that eventually it will be full and I will get a good rent. Is this a single household or an HMO for planning and/or licencing (3 storys)?

    In both cases (the first imaginary, the second real) what authority do I have to demand proof of the relationship of the various occupannts in order to satisfy the “single household” test, what authority would the planning office have to ask to see such proof.

    Ironically the first “household” is comprised of many people who are not related through blood or marriage and yet the first scenario (repectable doctor and extended family) would cause much less suspicion and objection from neighbours than the second (group of migrant workers)

    With imagination I suspect that this legislation can be rendered unenforacable and a good job too.

    Does anyone envisage getting planning permission for an HMO? Come to think of it has anyone got it yet?

    Sorry to be long winded but I needed to illustrate my point!

    Mike

    • PainSmith 17th May 2010 at 8:31 pm

      @Mike
      To answer your questions (briefly!).
      1. Lots of planning uses do not fall into any planning category. Larger HMOs have always fallen outside any planning category and therefore always require planning permission. This will ontinue to be the case.
      2. As long as the property continues to be used as an HMO and has been used in this way since before 6 April there is not material change of use so you will not need planning consent.
      3. Neither of your scenario’s constitute HMOs as the necessary relationships between the tenants to form a single household exist.

      The purpose of HMO planning is not to make your neighbours happy with the occupiers but rather to allow for the control of HMOs so that a single area does not become inundated with them. Whether it actually does this is, of course, a matter for debate.

  • Mike 19th May 2010 at 10:23 pm

    Thanks for your understandably brief response, if I may just ask a couple of short supplementals?

    In both the scenarios I painted the tenant has told me about the family relationships but I have no proof.

    The first scenario (The respectable, if large, family) would raise no suspicion however the second (group of migrant east European workers) would and might lead to the matter being referred to the planning office.

    How would they decide if a planning application is required? Is there now a burden of proof on landlords to have to demand proof of tenants familial relationships to ensure that they are “a family” and not “an unrelated group of sharers” before letting?

    If the purpose of the legislation is to prevent studenification of an area then what criteria would the planning office use in considering an application that was for what was to be the first HMO within half a mile (clearly not an over bearing proportion of HMO’s in the area)? And if a petition was got up and 100 NIMBY’s objected to the application how would that sway their consideration?

    To cut to the point the legislation hinges on a definition based on the existence or otherwise of familial relationships but who has the investigative powers or carries the burden of proof?

    To take it to its ridiculous extent all Mr Landlord has to say when the planning man calls is “Sharing? No gov those 5 lads they all told me that they are brothers and cousins” what does Mr Planner do then? Can he demand documentary proof of ID and familial relationship? I think not, unless of course 1984 has truly arrived!

    Mike

  • tony 30th May 2010 at 10:37 am

    I hesitate to query an expert opinion, but I think that by definition a use class is merely a form of permitted development within that class and sometimes outside it.

    So if a property has been an HMO for 10 years, it cannot be enforced against, provided there is no material alteration in its use.

    So the intoduction of a new use class cannot be said to be an act of development, and the continuation of the HMO use does not need planning permission.

    Perhaps that is why DCLG envisages a fairly small number of additional planning applications.

    It will be very fifficult, I feel, for a LPA to enforce against an HMO of, say, 5 years standing.

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