Planning refusals for HMOs double amid rising council restrictions

Planning refusals for HMOs double amid rising council restrictions

Planning refusals for Houses in Multiple Occupation (HMOs) have more than doubled in five years, with councils increasingly using licensing and Article 4 directions to restrict new HMOs, according to a recent analysis of 144 English local authorities.

A new report by property company 1st Avenue reveals that planning refusals for HMOs rose from 590 to 1,203 over the last five years. Approval rates remained steady at about 68% between 2021 and 2023 but declined in 2024 and 2025, with 2026 figures so far showing a 63% approval rate. The tightening of planning permissions and licensing regimes reflects councils’ efforts to control the growth of HMOs and address concerns about housing standards and community impact.

The analysis highlights a significant shift in local authority approaches, with many councils introducing Article 4 directions to remove permitted development rights that previously made it easier to convert properties into HMOs. The National Residential Landlords Association estimates that approximately 75 to 80 English councils have implemented such directions, further complicating the process for landlords seeking to establish licensable HMOs.

Analysis of planning and licensing trends for HMOs

Paul Endacott of 1st Avenue explains that the rise in refusals is not simply a conflict between landlords and councils but reflects a broader housing challenge. “When licensable HMOs are refused planning permission or licences, the demand for affordable shared housing does not disappear but shifts elsewhere,” he said. This “elsewhere” often involves smaller, less visible properties or informal arrangements that fall outside typical council inspection regimes, raising concerns about tenant safety and housing quality.

Local authorities have also intensified licensing requirements for existing HMOs, focusing on fire safety, room sizes, and living standards. While these measures aim to eliminate poor-quality and overcrowded HMOs, there is a risk that blanket restrictions, particularly those imposed through Article 4 directions across entire boroughs, may inadvertently exclude well-managed HMOs. This could reduce the availability of safe, affordable shared housing options for tenants.

Endacott emphasises the need for councils to differentiate between rogue landlords and responsible operators. “Councils are right to clamp down on poor-quality HMOs run by rogue landlords, but blanket restrictions risk filtering out well-managed shared housing alongside the bad,” he said. This tension between raising standards and maintaining affordable housing supply remains unresolved at both local and national policy levels.

Context of HMO regulation and housing affordability

HMOs have long been a critical component of the UK’s rental market, providing affordable accommodation for students, young professionals, and low-income renters. However, concerns about overcrowding, poor property conditions, and community disruption have led to increased regulation. Licensing schemes introduced over the past decade require landlords to meet specific safety and management standards, while planning controls aim to manage the concentration of HMOs in certain areas.

Article 4 directions, which remove permitted development rights, have become a key tool for councils seeking to control the growth of HMOs. These directions require landlords to obtain full planning permission before converting properties into HMOs, adding time, cost, and uncertainty to development plans. While intended to protect neighbourhoods, these measures can also restrict the supply of affordable shared housing, exacerbating the housing shortage.

The balance between ensuring tenant safety and maintaining affordable housing options is delicate. The increased refusals and licensing burdens may push some landlords to operate informally or convert smaller properties that evade regulation, potentially increasing risks for tenants. The lack of a central register for Article 4 directions complicates landlords’ ability to navigate local restrictions effectively.

Practical implications for landlords and letting agents

For landlords and letting agents managing or considering HMOs, the rising number of planning refusals and stricter licensing regimes signal a more challenging environment. Securing planning permission and licences is increasingly complex and may require additional investment in property improvements and compliance measures. Landlords should anticipate longer lead times and higher costs associated with obtaining approvals.

Those operating HMOs must ensure rigorous compliance with licensing conditions, particularly regarding fire safety, room sizes, and property standards. Failure to meet these requirements can lead to licence refusals or revocations, enforcement action, and reputational damage. Letting agents should advise clients accordingly and maintain up-to-date knowledge of local authority policies, including any Article 4 directions in force.

Given the risk that some councils may apply blanket restrictions, landlords should engage proactively with local planning authorities to understand the specific criteria and evidence required to support applications. Demonstrating good management practices and commitment to tenant safety may improve the chances of approval. However, landlords should also be prepared for the possibility that some well-managed HMOs may still face refusal under increasingly restrictive policies.

Uncertainties and what landlords should monitor

While the current trend shows increased refusals and tighter licensing, the future regulatory landscape remains uncertain. National housing policy may evolve to better reconcile the demand for affordable shared housing with the need to raise standards. Any changes could alter the balance of local authority powers or introduce new frameworks for HMO regulation.

Landlords should monitor developments in planning law, licensing requirements, and Article 4 directions. The absence of a central register for Article 4 directions means landlords must check local authority websites and planning departments regularly. Changes in government guidance or court rulings could also impact enforcement practices and landlord obligations.

There is also uncertainty about how informal or unregulated shared housing will be addressed. If demand continues to outstrip supply of licensable HMOs, local authorities may need to consider alternative strategies to ensure tenant safety without unduly restricting affordable housing options.

What landlords should consider now

• Review all current HMO properties for compliance with licensing conditions, particularly fire safety and room sizes.
• Check with local planning authorities for any Article 4 directions or changes in permitted development rights affecting HMOs.
• Engage with planning officers early when seeking permission for new or converted HMOs and prepare robust applications demonstrating good management and safety standards.
• Stay informed about local authority policies and national regulatory developments impacting HMO licensing and planning.
• Consider the risks of informal or unregulated letting arrangements and the potential consequences for tenant safety and legal compliance.

Keeping your rental properties compliant amid HMO restrictions

Membership of The Landlord Association (TLA) offers landlords and letting agents access to up-to-date compliance resources and practical guidance tailored to the challenges of managing HMOs under tightening regulations. TLA’s BETA testing of ORBIT, the new property management and compliance platform, provides tools to organise HMO portfolios, track licensing and planning documentation, and record safety inspections and communications. This can help landlords maintain evidence of compliance and prepare for licensing renewals or planning applications.

Access to TLA member compliance support ensures landlords stay informed about local and national regulatory changes, including Article 4 directions and evolving licensing requirements. ORBIT’s developing AI assistant can assist in managing documentation and reminders, reducing administrative burdens during this complex period. Exploring TLA membership and ORBIT BETA access can provide practical support for landlords navigating the increasingly restrictive environment for HMOs.

Landlords should regularly review their property records and licensing status, monitor local authority announcements, and keep detailed evidence of compliance activities to mitigate risks associated with refusals or enforcement action.

As councils continue to tighten controls on HMOs, landlords must adapt their management practices and stay vigilant to regulatory changes. The evolving landscape demands proactive engagement with planning and licensing processes to safeguard the viability of shared housing investments while ensuring tenant safety and legal compliance.

Sources: Landlord Today