Change of use / Article 4 Direction

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    Change of use / Article 4 Direction

    Hi, in September 2011 I bought a property in Sheffield with the sole purpose of letting to 4 students. At that point it was not classed as an HMO, I was in regular contact with the Council and was advised. Then in December I received a random email from the Council asking if I was aware of this new law 'Article 4 Direction' which meant that I had to apply to the Council to change the use from C3 (Residential) to C4 (HMO). This was denied.
    I now have a property which is neither viable to keep or to sell to the only market which could potentially be interested - landlords.
    I totally understand the purpose of the new law, but a street where 98% are students!!! No family would be interested!
    Any advice on appealing against their decision please!
    I believe this law was not publicised - even one year on some agents aren't aware.At the time auctioneers and agents should all have been informing potential buyers. I would not have purchased this particular house if I had known. Neither legal party were aware either.
    I would sincerely appreciate any advice or legal recommendation!

    #2
    Unfortunately I don't think there is much you can do. Lots of people are totally unaware of article 4 and its implications. Lots of councils are implementing article 4 to control HMO's. Its not a new law, just the use of existing ones, as far as publicising it I guess it was on their website and there would have been a consultation period(Short, maybe 4 weeks) early on in the process.
    Sheffield council proposed the article 4 directive in December 2010 and it came into force in December 2011, 3 months after you purchased, so it was already pretty much a done deal. I'm guessing your dealings with the council were with the housing dept, a totally separate department to planning which enforce article 4.
    You can still let the property to 3 tenants without planning permission though. You are right not many families will want to live in a student area, but if they don't control HMO's then there will be no family homes.

    Comment


      #3
      Hi there carrieian

      I am sorry to hear about your situation.

      Article 4 came into play some time ago. Did you have tenants in the property before your local authority imposed Article 4. If you did then you can keep going on.

      A HMO licence is enforced whereby the property on 3 floors and has more than 5 bedrooms?

      One option is to rent the property to LHA as 2+2. Whereby the LHA tenant gets a one bedroom rate provided that they have a living room, a bedroom and a shared kitchen and bathroom.

      Best of luck.
      Warm regards

      Simon Misiewicz
      Property Tax Specialist & Property Investor

      Comment


        #4
        Originally posted by DNM2012 View Post
        You can still let the property to 3 tenants without planning permission though.
        Not unless two of them are in a relationship/married/civil partnered, you can't.

        In planning terms, a small scale HMO (use class C4) comprises 3-6 unrelated tenants sharing common facilities, so three unrelated tenants would constitute a change of use from C3 to C4 - precisely the thing that the Article 4 Direction prohibits without planning permission.
        IMPORTANT NOTE: If you take any advice given/follow any course of action suggested by me in this or any other post, you do so entirely at your own risk. You must assume that I am not professionally qualified in any particular topic under discussion (and therefore my posts are purely my opinions) unless I explicitly state otherwise.

        Comment


          #5
          Rupert Rigsby,

          I stand corrected. I always read it as up to 3 was ok, but now I see 3 or above is the tipping point.

          Comment


            #6
            I just wanted to thank you all for your responses. Although none helped I appreciate the time spent.
            I have since taken my solicitor to the Ombudsman, but they seem in favour of my solicitor. My argument was that that they accepted and relied on basic searches provided by the vendor's solicitor (The pending Article 4, was there and would have been seen if a FULL search had been carried out!). So, no win there. I have been advised that the vendor's solicitor cannot be held to blame as they were not acting on my behalf (funny, yet my solicitor was acting on my behalf yet they are not to blame either), but his client is, so that I feel will be one of my next move.
            The Council should have publicised the introduction of Article 4 heavily, loudly and aggressively! All agents should have advised and informed their potential buyers. I feel the Council are very much to blame for so many people being unaware of this.
            I have now sent a letter to my MP in the hope that he may agree and take my case to the House of Commons!

            Comment


              #7
              The Sheffield Article 4 Direction does not affect existing HMOs that were in use as HMOs on 10th December 2011. I guess you are saying you didn't start before then?

              If so, then you are bound by the policy that sets out refusal if more than 20% of residencies within 200m of your property are already shared.

              I haven't read the full policy for Sheffield but my local one also has an extra sting in the tail as it still permits C4->C3 and so, if a student house fails to let and is let instead to a family, it LOSES C4 and will need planning consent to get it back. In effect, "draining down" the HMO percentage to help achieve the "mixed" population objective for the area.

              If this also applies in Sheffield, it is well worth visiting the council and asking to be shown the current map of HMOs (that they MUST maintain in order to correctly apply their policy) and verify the current % of dwellings within 200m that are HMOs. At least then you would see if there is any realistic future chance - i.e. if its 80% then forget it.

              Comment


                #8
                Originally posted by carrieian View Post
                The Council should have publicised the introduction of Article 4 heavily, loudly and aggressively! All agents should have advised and informed their potential buyers. I feel the Council are very much to blame for so many people being unaware of this.
                I have now sent a letter to my MP in the hope that he may agree and take my case to the House of Commons!
                The council did promote this Direction very heavily at the time and consulted all agents/student housing providers in Sheffield on the introduction, not that the consulation made any difference at all, as we were involved with this process. It also has it's own section on the council website.

                Comment


                  #9
                  Article 4

                  The Council did not publicise enough. I have just had confirmation that they only placed one ad and all publicity were in places where present and future landlords would be around, for example, schools, primary and higher! Agents and auctioneers weren't aware so how'd that good publicity? Besides, not all investors live in Sheffield!

                  Comment


                    #10
                    Article 4 promotion

                    MAF,

                    The Council publicised in schools etc, not the main places where landlords congregate. I have their list and it is not extensive. Also, regarding agents being aware, I have letters from several who have no clue! If they were informed why did none of the agents or auction houses I visited over the course of one year advise of this pending restriction? It intrigues!

                    Comment

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