Editor's note: This brief was summarised by The Property AI Newsroom from a report by Property118. Read the original article for full details.

HMO Planning Refusals Double Across English Councils

Councils in England refused 1,203 HMO (House in Multiple Occupation) planning applications in 2025, compared to 590 refusals in 2021. Over the same period, the number of HMO planning applications decided by councils rose from 1,848 to 3,454 across 144 English councils.

The approval rate for HMO applications fell from 68.1% in 2021 to 65.2% in 2025. This resulted in 613 more HMO applications being refused in 2025 than four years earlier. The report notes that these refusals have not reduced the demand for affordable rooms, but have prevented more of these rooms from being provided legally.

For letting agents and inventory clerks, the increase in planning refusals and the changing regulatory landscape are significant. The article highlights that HMOs are often a key source of accommodation for groups such as students, young professionals, key workers, and people seeking affordable housing options. The practical effect of more refusals is that tenants may have fewer legal options for shared accommodation.

Article 4 Directions and Local Policies

The report explains that in many parts of England, converting a standard dwelling (C3) into a small HMO (C4) can be done under permitted development rights. However, when a council introduces an Article 4 Direction, landlords must apply for full planning permission, which is then subject to local HMO policies. Some councils impose concentration limits, making it difficult to secure permission if a certain percentage of HMOs has already been reached in an area.

Article 4 Directions, originally intended to address specific local issues, are now being applied across larger areas, sometimes covering entire towns or boroughs. This expansion can make it more challenging to create lawful shared housing, affecting both landlords and tenants.

Implications for Landlords

The report notes that landlords now need to conduct thorough planning due diligence before purchasing properties for HMO conversion. It is important to check whether a property is within an Article 4 area or if new restrictions are proposed, as this can impact the viability of HMO projects.