Landlords specialising in Houses in Multiple Occupation (HMOs) are facing increased scrutiny from local authorities as councils across England introduce tougher planning restrictions to curb the growth of shared rental housing.
A growing number of councils, including Bolton, Salford, Liverpool, Leicester, Coventry and several London boroughs, are adopting Article 4 Directions – a planning mechanism that removes permitted development rights and requires landlords to obtain full planning permission before converting family homes into HMOs.
The measures, aimed at preventing “over-concentration” of shared accommodation in specific neighbourhoods, come amid rising demand for affordable rental housing and concerns about the balance of local communities.
The restrictions add to the already complex regulatory landscape faced by landlords, many of whom are also managing selective or additional licensing schemes.
EXPANDED FRAMEWORK
In Salford, landlords were given a deadline in late 2024 to secure additional HMO licences in areas such as Langworthy, Weaste and Seedley, with non-compliance risking fines, legal action or enforcement measures.
Similar frameworks are being expanded in Liverpool and other northern cities, creating what industry observers describe as a “dual barrier” for property owners – requiring both a licence and planning permission to operate legally.
Mish Liyanage (main picture), Founder of Mistoria Estate Agents, says the trend represents a structural shift in how local housing markets are managed.
HIGHER RENTS
He warns that the combination of planning and licensing controls could deter new HMO developments, limit supply and push rents higher in areas where shared accommodation is already in short supply.
He adds that the new policies coincide with wider reforms under the forthcoming Renters’ Rights Bill, including the abolition of Section 21 “no fault” evictions, tighter rent controls and mandatory minimum property standards – all of which will increase compliance pressures on private landlords.
Liyanage advises landlords to check local planning policies before purchasing or converting properties, ensure licences and safety standards are up to date, and seek expert guidance on navigating the expanding web of planning and housing regulation.
He says: “The rise of Article 4 Directions and tighter planning controls is not a passing trend, it’s a structural shift in how councils are managing local housing markets.
“For landlords, this means adapting business models, reviewing portfolios, and staying agile in a rapidly changing regulatory landscape.”
