Permitted Development Rights: What You Need to Know
There are many important things to note in property investment; in addition to tricks of the trade, there are rules and regulations to get your head around before you embark on your first venture. Over the years, our experts have spoken with many budding property developers who have not fully understood the wide range of processes and rights associated with property development. Permitted Development Rights are one such aspect that is essential for you to know about in order to invest in property successfully.
Permitted Development Rights are a massive opportunity for property developers; with fewer planning applications to negotiate, you can convert old and unused buildings and get them back on the market for residential use. Read on to find out more about this savvy property development opportunity.
What are Permitted Development Rights?
Permitted Development Rights (PDRs) give property developers the right to make specific changes to their building without the need to apply for planning permission. Developers also need to obtain ‘prior approval’ from the local planning authority beforehand.
Since 2015, the Town and Country Planning (General Permitted Development) (England) Order 2015 has been in place, allowing PDRs to be granted without planning permission. Last year, changes were made to PDRs in response to the Covid-19 pandemic, but some were time-limited and others likely to change once lockdown restrictions are completely lifted.
PDRs and Article 4
Under the 2015 Order, it is stated that LPAs are allowed to suspend PDRs in their area. If this is the case for you, you will have to submit a planning application for the work you are proposing to carry out, despite PDRs removing the need in the first place.
This situation is usually related to areas ‘threatened’ with change, such as conservation areas which LPAs are obliged to protect due to their historical importance. There may even be special controls in place allowing them to protect these conservation areas, so by contacting them before making any changes, it will be made clear whether you can do so or not for your building.
The likes of conservation areas are crucial to LPAs due to the financial benefits they bring. These buildings’ visual aesthetic and uniqueness are usually reflected in the higher price tags seen on the market. Assessments have also been carried out in this aspect, further explaining why changes should not be made to these areas.
Office-to-Residential Change of Use
In 2016, the office-to-residential change of use PDR was introduced. Since then, there have been at least 64,798 office-to-residential conversions out of 72,980 new dwellings added to the housing stock through PDRs. These figures have resulted in controversy and change in the 2015 Order.
Out of the 64,798 conversions, most ranged from high to extremely poor quality, according to the Royal Institute of Chartered Surveyors in 2018. They said that PDR schemes are “significantly worse” than those completed through the planning process.
The Town and Country Planning (Permitted Development and Miscellaneous Amendments) (England) (Coronavirus) Regulations 2020 introduced last June amended the 2015 Order. Office-to-residential conversions are now required “adequate natural light in all habitable rooms.”
All new homes now created under PDRs also have to comply “as a minimum” with the nationally described space standards due to the Town and Country Planning (General Permitted Development) (England) (Amendment) Regulations 2020 introduced earlier this month.
Changes to upward extensions were included as well in last year’s Town and Country Planning (Permitted Development and Miscellaneous Amendments) (England) (Coronavirus) Regulations 2020. These updates saw PDR introduced for new homes, allowing property developers to add up to two additional stories on top of purpose-built, detached blocks of flats only.
However, in the Town and Country Planning (General Permitted Development) (England) (Amendment) (No. 2) Order 2020, this was extended from new homes to those built since 1 July 1948. Extensions to existing homes and the creation of new homes above certain other types of buildings were also added, but this cannot be carried out in conservation areas, national parks, areas of outstanding natural beauty, or sites of particular scientific interest.
The Royal Town Planning Institute has previously stated their case against upwards extension PDRs, which includes ‘poorly-designed dwellings’ and ‘a major impact on existing occupiers and neighbours’ as well as other points which they argue is best for the country’s towns.
Demolition and Rebuilding
As part of the government’s response to Covid-19, the Town and Country Planning (General Permitted Development) (England) (Amendment) (No. 3) Order 2020 came into force to deal with the demolition and restructuring of buildings as residential.
The PDR being used must ensure that the building has been vacant for at least six months before demolition, and the obvious ‘prior approval’ must be put in place as well beforehand.
Article 4 of the 2020 Order states that the building must either have:
- been built before 1 January 1990;
- be vacant, redundant and free-standing;
- or fall within the B1(a) offices, B1 (b) research and development, B1 (c) industrial processes (light industrial), and free-standing purpose-built residential blocks of flats (C3) use classes on 12 March 2020.
More information can be found on the limits of the development scale in the Explanatory Memorandum.
Other Updates to PDRs
During a government-run consultation into updating PDRs last December, several points were made which were criticised by the Local Government Association, the Royal Town Planning Institute, the Town and Country Planning Association, the Chartered Institute of Housing, the Royal Institute of British Architects, the Construction Industry Council, the British Property Foundation, London First, the Chartered Institute for Archaeologists, the Wildlife Trusts, and the Theatres Trust all in separate responses.
The government’s main points in the consultation included:
- A new PDR allows change of use from the new use class E (commercial) to C3 (residential).
- An amended PDR for the extension of schools, colleges, universities and hospitals.
- A right for prisons and defence sites, allowing prisons to expand their facilities.
- Faster decisions on applications for planning permission.
- Existing PDRs will be consolidated and simplified.
- National parks and other sensitive sites would continue to be excluded from PDRs, but the PDRs proposed would apply in conservation areas.
Commentators argued that the changes could have unintended consequences, such as the loss of active frontages in high streets or the possible loss of sports and leisure facilities, as well as other possible disadvantages down the line affecting multiple sectors in the UK.
If you would like to learn more in a detailed discussion-based format, then watch our Permitted Development Rights Property Forecast episode. This discussion will see our panel of experts consider the changes to PDRs and how they could benefit you from a property developer standpoint.
Emma Birchley hosted the programme, guiding the conversation to include all you need to know about PDRs and how they can affect the property investment market.
Our expert panellists offer great advice to property developers looking to profit from PDRs and make most of the less restrictive planning process. Whether you are considering an office-to-residential conversion or changing the use of various retail and commercial buildings, our experts are always sharing their views and experiences of PDRs. Make sure to follow our YouTube channel to stay up-to-date and register to join our exclusive VIP email list to get early bird access to our next upcoming live event, and access to our next Property Forecast 48 hours before it airs on Sky.