WHAT IS ARTICLE 4 ?

Article 4 is a change to planning regulations which would mean that any property that had established use as a single dwelling house (Planning Use Class C3) and a owner wants to change its use to a small HMO (Planning Use Class C4) planning consent would be needed.

With a local authority adopting an Article 4 direction it would remove the previous permitted development rights for changes to be made.  Therefore any HMO, regardless of the number of tenants, automatically would require planning permission.

It does not mean that planning permission would not be granted.  However, it would need to meet a “stress” test via the council to ensure that the merits of each HMO are considered, such as, location, cumulative and proliferation impact on the area, amongst other requirements.

Councils can adopt Article 4 direction in certain areas, streets or even City Wide.  Birmingham Council have recently announced the whole of the City will be under Article 4 Direction as of June 2020.

https://www.birminghammail.co.uk/news/midlands-news/new-restrictions-converting-homes-hmos-17437057

 

IF I OWN A HMO NOW, WHAT SHOULD I DO?

To future proof your HMO investment both now and post Article 4 direction, a certificate of lawfulness should be obtained to solidify your HMO dwelling.  This would confirm the existing lawfulness and establish you as a lawful HMO , under council planning records.

If your property was being used without planning permission as an HMO (either small or large) before Article 4 is implemented in your local area, and is still in the same use, you may need to ensure that the use of your property is not in breach of planning controls.  A Certificate of Lawful Development (CLD) for an existing use can be used to validate you HMO in order to regularise your HMO.

Once Article 4 is in place the council could ask you to provide proof that your HMO did not require planning permission.  If you do not have evidence that you did not require planning permission for the change of use, planning enforcement action could be taken.

If you have created any side or rear extensions to the property (during the Permitted rights dates) and no planning permission was obtained, it may contravene planning and thus it will be illegal to operate as a HMO.

 

RE-MORTGAGING, FINANCING AND SELLING HMO’S IN A ARTICLE 4 AREA.

Once article 4 is introduced in areas, lenders, surveyors and solicitors will all be aware of it and therefore have to follow protocols and rules that specifically apply to Article 4 (applications), and thus how sales or finance are  arranged during the application process.  The number of landlords who are unaware of the requirements until they want to refinance are staggering. Landlords face the question of whether the property has a certificate of lawful use or relevant planning consent, either at the time when they want to sell the HMO, re-finance it, or lend against their HMO.

This is not helped with solicitors that may not be too familiar with HMO’s, local conditions and especially Article 4 directions.  At the time of exchange and completion for a HMO, several (protocol) questions will be asked to establish the use of the property based within an article 4 area.  Most of these questions will seek to establish the lawfulness of the HMO, even though Article 4 may not have existed when the development was completed.   With limited and unclear information a solicitor may not be able to satisfy his/her conditions that would allow the completion to take place.  A certificate of lawful development can be used exactly for this reason.  This document would validate the lawfulness of your HMO and protect you from any unreasonable conditions imposed form lenders, surveyors and solicitors.  This would in essence “future  proof” your investment, and overcome any barriers to complete your transaction, both now and in the future.

A CLD is a legal document stating the lawfulness of past, present, future use of your building use, operations or other matters. Once granted by the local planning authority, the certificate means that no enforcement action can be carried out to the development referred to in the certificate. If you submit an application for CLD and your application is refused then it may have further financial implications to your HMO investment portfolio. Furthermore if a Landlord does not want to regularise their HMO, it is strongly recommended that they retain sufficient documentation to demonstrate lawful use as a HMO, pre-Article 4 direction. The application for a certificate of lawful development can be lengthy and drawings of the  development would need to be submitted.

We specialise in providing Certificates of Lawful Development – (CLD’s), for all types of HMO approvals. Take advantage of our “pre-application” CLD assessment from only £239 today!

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