Landlords looking to new opportunities as the tax rule changes bite into conventional buy-to-let.
Converting unused office space and light industrial units to suitable housing units, usually as flats or Houses in Multiple Occupancy (HMOs), is one of the Government’s objectives to alleviate the housing crisis, without encroaching on the green belt.
The Government’s pledge to build one million new homes will take some years, but office and industrial building conversions can be processed much more quickly, as can renovations for rental of all older property types.
Landlords and developers will still need to seek planning approval with permitted development opportunities but these smooth the way, and given the need for new residential accommodation, will speed the planning process for many more schemes, which are likely to be approved as a matter of course.
Clever Lending, a finance broker has said that they have recently increased their commercial finance business as a result of the Government making the permitted development rights permanent, and they are seeing more landlords looking to buy commercial property such as industrial and retail units to let.
Developers with existing approval for residential use under the existing permitted development rights now have three years to complete the change of use, extending the date for completion to May 2019.
Sonny Gosai, Sales and Operations Manager at Clever, said:
“This year we have seen many of our lender partners open up access to new lines of funding which has increased the liquidity in the commercial sector and initiatives such as permitted development are helping lenders to lend and developers to get the finance they need. They can either tear down the existing office building or renovate it to provide much needed housing in local communities.
“We have had enquiries from many of our broker partners with clients who are entrepreneurial developers looking to benefit from the recent permitted development rights ruling, by turning unused offices in to apartments or HMOs. With a steady rise in the number of lenders offering competitively priced commercial loans, we have successfully placed these case with our specialist lender partners.”
Lending taps into permitted development opportunities https://t.co/1eG1vcXUmv
— LandlordZONE (@LandlordZONE) May 16, 2016