Permitted Development Is The Way To Make Money In UK Property
Hi Everyone,
I attended a live property meeting on wednesday evening in Portsmouth, Hampshire in the UK which was organised by Property Investors Network. This is a property community that I belong to here in the UK, founded by Simon Zutshi, who i believe is the UK´s top property guru.
There are more than 50 different Property Investors Network meetings that are organised to meet regularly on different dates once per month in different locations in the UK, and some of them are in physical meeting locations, others are organised as online meetings on zoom.
The meetings used to be all at physical locations, with the attendees meeting in person for the purpose of networking and listening to guest speakers. The Property Investors Network (PIN) organisation arranges a pool of speakers who can speak on a circuit at the different physical locations or online via zoom.
The pool of speakers offer different skills and specialisms to the attendees at the different property meetings, who are all interested in some aspect of property. Some attendees are landlords who own property, or others who offer services, professionals or tradesmen, and there are others who add value in some way to property (for example by renting property from a building owner, and then renting it out for short periods at a higher rate, such as using the airbnb or booking.com rent to rent model).
I heard one particular speaker at yesterday evening´s meeting. He is a very engaging character called Ritchie Clapson, who is a coach and educator in the property field, and he is a very amusing speaker because he interacts a lot with his audience in a very entertaining way.
Ritchie is a retired structural engineer who has worked on many big property development projects in the UK in the past. He is now retired and offers his knowledge and services as a coach and educator to encourage potential property entrepreneurs in a particular relatively narrow field of expertise and application of the right skills. He has written 5 books about conversion of industrial and commercial buildings to residential.
Ritchie´s property niche is that of conversion of commercial or industrial buildings into residential use, using Permitted Development Rights in England (these same laws do not apply in Scotland of Wales as they ahve slightly different legislation, which does not include the Permitted Rights for Development).
So what does all this mean exactly and why should you care?
The background to the whole of this theme is that the Planning Approval system in the UK is broken. What does that mean? It means that anyone applying for permission under the Town And Country Planning Laws for a new use or a change of use of their land or buildings does not know when or whether they will obtain or secure that permission. The local authority staff who run this planning application system are underpaid and overworked, and there is a backlog in the system. An application may be processed within the 56 day statutory period, or more likely the local authority will be late and make arbitrary excuses to not progress your application expeditiously, requiring further information in order to delay the process. Then you may receive a decision finally that will be conditional on further information being provided and approved by the planning authority, all of which makes it difficult to get a final resolution of the application in a timely way. You may be waiting months, or in Although in theory an application should be processed by the local authority planning staff and an answer given within 8 weeks, 56 days, in practice this is far from the reality.
Anyone making a planning application just does not know when or whether they may secure the new planning use that they are looking for. This means there is massive uncertainty and therefore risk within the system. This can lead to costs escalating massively, owing to extended cost of finance.
Permitted Development is a UK Government Law which over-rides the local planning laws and allows anyone to develop certain types of commercial building for residential use provided they conform to the set criteria.
Effectively this reduces risk massively and therefore reduces the timescale and the finance costs associated with such development.
In a nutshell, Permitted Development of Class E Commercial buildings of all types , converting to residential purposes (for which there is massive demand, owing to a critical housing shortage, is the best way to make money in property development in the UK.
I wish you all a great weekend, wherever you are in the world.
Cheers
Alan
Recent Comments
4
Interesting post Alan.
Renting a property and putting it on AirBnB or Booking com. Hmmm, now there's a thought! Holiday in Devon anyone???
Paul
Very interesting read Alan..
I totally agree that the Planning approval system in the UK is broken..
My Father wanted to build 12 new homes on some land that he owns, but was messed around with for years without getting a definitive answer either way...
In the end he just gave up on that project but did get permission to build one big new house for himself!
This Permitted Development law sounds like a great idea to me though, thanks for the share my friend and enjoy a wonderful weekend as well!