Fair Rents (Scotland) Bill or Artificial state manipulation of free market rent?10:34 AM, 6th November 2020
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Inconsistent planning policies for student landlords are making some cities no-go zones for property investors.
The problems arise from ‘article 4 directions’ for small shared rental properties – where three to five tenants share a house.
Some councils, mostly in Labour-controlled council areas, are imposing the direction that requires a landlord to get planning permission before letting a small shared house.
Around 40 councils across England have applied or implemented the direction – with councils in Oxford, Milton Keynes and Newcastle leading the way.
Most of the directions are in university cities where councils claim shared houses are leading to the studentification of some neighbourhoods.
Letting a small shared house is a postcode lottery. In some cities, the article 4 direction only applies to some streets or neighbourhoods, while Oxford has a city-wide ban and refuses planning where the number of small shared houses exceeds 20% of the homes in any 100 metre stretch of road.
The latest council to consider article 4 directions are Falmouth and Leicester.
Leicester City Council has imposed a ban on student flat developments further than 800 metres walking distance from the University of Leicester or de Montfort University. Councillors are also considering an article 4 direction on small shared houses.
Meanwhile Cornwall County Council has rejected a plea for an article 4 direction from Falmouth Town Council on the grounds tightening planning controls is ‘premature’ during the reform of government housing benefit rules.
An article 4 consultation is also underway in Bath.
Student landlords have a window of opportunity in cities considering article 4 directions.
The process involves a consultation period and generally a 12-month period when planning for new small shared houses is not required.
Once the article 4 direction is implemented, any existing small shared house has planning permission by default without making any application to the council.
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