August 31st, 2021. Andrew Hosford
What Are Permitted Development Rights, and How Have They Changed?
A number of changes to permitted development rights came into play in 2020. With further amendments and additions in 2021, an understanding of the updated permitted development rights is now essential for developers. So, what is possible under the new guidelines? Find out all you need to know, here.
What Are Permitted Development Rights?
The government’s permitted development rights allow property owners and developers to make certain changes without the need to submit a full planning application through the local authority.
Permitted development rights can be a huge advantage for homeowners, developers and investors, as they reduce the amount of red tape needed, thereby speeding up the process and reducing associated costs. They cover a range of building works, as well as changes of use.
Do All Properties Have the Same Permitted Development Rights?
There are some restrictions in place. Notably, permitted development rights do not apply to flats or maisonettes, due to the impact that alterations may have on neighbouring properties.
Your permitted development rights also differ depending on the location of your property. For example, you may still require planning permission if you are within:
- A conservation area
- A National Park
- An Area of Outstanding Natural Beauty
- A World Heritage Site
- The Broads
Similar restrictions can apply if your property is listed. In any case, the general advice is always to contact your local planning authority before any work takes place. By discussing your proposal in detail, you can avoid complications later down the line and ensure your development will be permitted.
What Changed in 2020?
The government introduced a number of permitted development changes in 2020, with the goal of encouraging an increase in development projects to help re-start the industry. The new regulations permitted additional projects to be carried out without the need for planning permission.
These changes had a wide scope, including a simplification of use classes, greater opportunities for change of use, plus expanded opportunities to add vertical and rear extensions.
Prior to the introduction of these changes we discussed the popularity of changes of use in our blog ‘Is the Current Climate Encouraging Changes of Property Use?’. The subsequent expansion of permitted development rules specifically for changes of use then started to be seen as a ‘window of opportunity’ for these kinds of development projects.
With new legislation having come into play from 1 August, this so-called ‘window of opportunity’ may have come to an end. However, the new clarifications still present opportunities for developers and investors.
Permitted Development Rights in 2021
So, where do we stand as of August 2021? Here is an overview of what the new permitted development rights cover, and which projects will now need additional levels of approval.
Changes of Use
One of the most notable changes to permitted development rights in 2020 was the greater scope for change of use without planning permission.
Under the 2020 regulations, office and retail properties of unlimited size could be converted to residential without the need for planning permission. However, this has now terminated.
The regulations now in place, from 1 August, allow changes from Commercial, Business and Service (Class E) to residential (Class C3), but with the following restrictions:
- The property must have been in Commercial, Business and Service use (Class E) for two years before benefiting from the permitted development.
- Properties must now be vacant for three months prior to the date of the application (excluding Covid-related vacancy).
- There is now a limit of 1,500 sqm (16,146 sqft) of floorspace per building which can change use.
- A fee of between £100 – £5,000 per new home may be applicable.
- Homes delivered must all meet the nationally described standards for space and light.
The permitted development right does not apply to listed buildings or other land listed in Article 2(3) of the General Permitted Development Order, such as National Parks and Areas of Outstanding Natural Beauty. However, it does apply to properties within conservation areas.
Though this legislation is now in place, any existing Article 4 Directions relating to office to residential conversions have been carried over until 31 July 2022. This protection provides councils who wish to preserve these directions sufficient time to do so, though quick and decisive action is needed.
Another significant change for developers to be aware of is that a ‘Prior Approval’ application is now required for proposed changes from ‘commercial, business and service or betting office or pay day loan shop to mixed use’.
This is designed to allow the Local Authority to review specific details and determine if further action is required. Read more on the Planning Portal.
Finance For Your Development Project
If you are embarking on a development project, having the correct finance is just as important as understanding the legislative changes covered here. Luckily, our experienced and specialist team can help.
Article By Andrew Hosford
August 31st, 2021
Andrew is a Director within Pure Structured Finance and a founding member of the company.
He previously spent a decade with a real estate advisory firm before launching Pure Structured Finance. He is highly experienced in arranging senior debt, mezzanine and equity finance for property investors and developers across all asset classes. His key focus is building long term relationships with clients, with a view to working closely with them and facilitating all their property funding needs.
Andrew is an established member of the finance community sitting on multiple boards including FIBA and is a regular panellist for various property awards committees.
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