Monday, June 27, 2011
The Government's decision to facilitate the conversion of
property from commercial to residential aims to boost housing
supply levels, but little is known about this type of renovation,
warn estate agents.
The National Association of Estate Agents (NAEA) welcomes the
policy to make conversion easier. According to the NAEA, planning
regulations have created restrictions that make the purchase of
properties with the potential for conversion too risky for
developers.
Peter Bolton King, Chief Executive of the NAEA said,
"Theoretically, the Government's decision to bring in this crucial
change to planning regulation will provide a much cheaper
alternative to new build properties.
"It will also go some way to solving the problems that
commercial property owners face - particularly those being hit with
high business rates for buildings that no-one occupies. But such
renovations are not simple undertakings. We advise that a
thorough evaluation of the work involved is carried out beforehand
to avoid additional cost burdens."
"For example, those looking for potential sites for conversion
will need to consider the location of the property, particularly
since the amenities you might find in a residential area may well
be lacking. And they must also factor in the additional costs
involved with existing building covenants."
For those looking to convert commercial property, the NAEA
recommends the following:
Weigh up cost of conversion vs new
build -Although fitting out an existing property
might seem like the cheaper option, commercial space often requires
more skilled labour to comply with standards for residential use,
therefore adding to overall cost of a project. Additional building
requirements are often applicable to dwellings such as Part L
regulations that ensure compliance to conservation of fuel and
power so it is always worth checking in advance.
Assess points of access -Given that a
lot of commercial property is situated within town centres where
zoning restrictions can affect parking and access routes, it is
important to look at this before purchasing the property. You don't
want to create your dream home, only to find you have to walk
several miles to get to your car, or worse still, pay hefty parking
charges each year. It is therefore worth contacting your local
council to clarify rights of way and parking arrangements.
Similarly, as some premises might have shared access to
additional space upstairs (such as an existing flat), it is worth
speaking with the owners to find out where you stand, as this will
no doubt impact on any internal changes you plan on making.
Additional external works might not be
exempt- It must be remembered that the legislation in
question applies to "change of use" only and so any extensions or
renovation of shop fronts are likely to be subject to regular
planning permission. Additionally, changes to high street premises,
especially in market towns might be bound by covenants that require
the facia to remain in-keeping with the surrounding area - this
could also add to the cost if specific materials are required.
Take a good look at the property's
surroundings -Look at the whole area to get a feeling
for it and be sure you are comfortable living somewhere which won't
be purely residential. While you might be closer to the shops, you
could in fact be further away from a school. Noisy neighbours might
also need to be considered if your property is located near to
bars, nightclubs and takeaways.
Be prepared to wait -Some local
authorities adopt a blanket policy when considering change of use
planning applications whereby the property must be placed on the
market from anywhere between six and twelve months. If the owner
can prove there is no market for the building commercially, they
may consider a change of use.
The consultation on the relaxation of commercial/residential
planning law closes on 30th June.