A new opportunity for Landlords as Permitted Development Rights change again!

If you are a Landlord of a semi vacant building or perhaps you are a Tenant in such a building, the latest changes to the

Town and Country Planning (General Permitted Development) (England) (Amendment) Order 2024) that came into force on 5^th March 2024 may be noteworthy for you.

What are the changes?

This Order amends the Town and Country Planning (General Permitted Development) (England) Order 2015 (“GPDO 2015”) by amending Class MA (Part 3 of Schedule 2 of the GPDO 2015) which deals with permitted development rights allowing changes of use of commercial, business and service establishments to dwellinghouses.

The amendments now mean that:

• There will be no limit on the cumulative floor space of the existing building which is changing use (there was previously a limit of 1,500 sq.m); and
• There will be no requirement to have a continuous 3-month vacancy period prior to the date of application for prior approval.

The remaining conditions as set out in the GPDO 2015 will continue to apply as before.

What do these changes mean?

These changes are intended firstly to help increase housing supply, particularly on brownfield sites (which was the clear message coming from Michael Gove in his press release of 13^th February 2024) and to increase the ability to repurpose otherwise underutilised commercial space to help meet the growing housing need.

Secondly for Landlords it is worth highlighting that the removal of the ‘vacancy’ requirement gives a new opportunity to seek prior approval for such change of use of a building whilst still receiving an income from it (through existing occupancy arrangements). On lease renewals in buildings where there is a prospect of change of use, Landlords may also want to negotiate flexible break rights, to use should prior approval be forthcoming. The picture for Tenants in such buildings is perhaps less positive, when the prospects for extending their occupation may be diminished, and they may find themselves needing to find alternative premises.

Permitted Development Rights in general

There has been a raft of changes to permitted development rights over a number of years now, and in the Explanatory Memorandum accompanying this latest Order, the Department for Levelling Up, Housing and Communities confirms that the various permitted development rights allowing for changes of use to dwellinghouses has in the 8 years to March 2023 resulted in the delivery of 102,830 new homes to rent or buy. In the last year alone, 9,492 homes were delivered using such rights (representing 4% of overall housing supply).

We cannot discuss permitted development rights without noting that these rights are still subject to condition and limitation. Prior approval also needs to be obtained from a local planning authority on various matters including (but not limited to) transport, flooding, natural lighting and noise. The Government’s nationally described space standards must also be met. Some properties subject to protective designations (for example in a safety hazard area, or a listed building) cannot use these rights at all.

An unpopular change for some?

Significantly, with permitted development rights there is no requirement to provide affordable housing nor to contribute towards school or health provision (amongst others) and so these changes are brought in against a backdrop of an undersupply of genuine affordable housing, with no actual resolution coming from the Government to the problem. It is therefore unsurprising that the Local Government Association, which represents local authorities, is actually calling for permitted development rights to be scrapped, to help ensure delivery of genuinely affordable housing across the country.

We will need to wait and see whether the loosening of the rights further will cause local authorities to look again at their Article 4 Directions (which, when applied, disapplies these permitted development rights) but the Government is vigilant about this and has the power to modify or cancel these at any time (although it must have clear reasons to intervene). For now at least, the affordable housing crisis goes on….

Building up?

Alongside the making of these changes, on 13^th February the Government also announced a new consultation on further proposals to change the permitted development rights – this time to support the densification of towns and cities through upward extension. This new consultation is seeking feedback on increasing the scope of buildings that might benefit from the existing permitted development rights to upward extension and using the prior approval process for demolition and rebuild opportunities. This consultation is open for feedback until 9^th April 2024, here.

If you are interested, whether for or against, please do take part.

In an election year, housing is clearly a hot topic for political debate (indeed it may be one of the key battlegrounds) but there is no doubt that the Government sees the use of permitted development rights as a way of helping to meet the housing need.