Advice for turning commercial property into residential property

29 May 2019

With the current state of residential housing in the UK combined with the falling retail presence on the high street, it’s no surprise that many are looking towards unused commercial property as a potential residential venture. In 2017, the number of office-to-residential conversions increased by 40 per cent according to one study.

Indeed, converting a previously commercial build into a series of residential spaces can prove to be a profitable move. But before you snap up that old factory or unused office space, take a look through Propseller’s top tips for commercial-to-residential conversions.

Do I need planning permission?

It is possible that you won’t need planning permission. A number of shops and offices are covered by the Permitted Development Rights issued by the government in part to deal with the housing crisis. It is intended to make such conversions an easier process. With this in mind, should you require planning permission for the commercial property you have chosen, you’re quite likely to be granted it.

According to the UK government website, permitted development rights are a grant of planning permission to allow building works and changes to be done without submitting a planning application. However, this does not override the need to “comply with other permission, regulation, or consent regimes”.

Restrictions with permitted development rights

It’s important to know that the area your building is in can affect the permitted development rights of your building. For example, these rights are restricted in National Parks, the Broads, World Heritage Sites, and Areas of Outstanding Natural Beauty. The rights are also restricted if the building is a listed building.

Plus, permitted development rights do not cover improvements, alterations, or extensions of a home created from commercial buildings. Be sure to speak to your local planning authority before beginning a project, especially if you plan to change the layout of the building or extend it.

What costs should I be aware of?

There are a number of costs beyond the construction itself that you need to be aware of, including:

  • Community Infrastructure Levy — a levy due on development of a property with a gross internal new area of 100 square metres or more.
  • Specialist buildings surveys — as a previously commercial property, it is important that your buildings survey is tailored to this.
  • Specialist commercial property solicitors — in order to secure the purchase, you will need a specialist commercial property solicitor on board.
  • Property title deeds — particularly for older buildings, hiring a conveyance specialist is recommended to make sure that there’s nothing in the building’s history that could prove problematic for your building plans.

Though there are costs and permissions to consider, converting commercial properties to residential property has the potential to be a very profitable venture.


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