Agricultural to residential proves most popular change of use
Agricultural to residential conversion is currently the most popular property change of use, according to Pure Structured Finance analysis of government data.
Since mid-2020, agricultural to residential conversion has prompted 540 applications, followed by office to residential change, with 459, and rental and sui generic uses to residential, with 177.
Light industrial to residential garnered 91 applications, Shops to residential 88 and to state-funded school or registered nursery from various with 10.
Overall, the total number of applications for property changes of use was 1,639.
Pure Structured Finance noted that between April 2014 and September 2020, the number of change of use applications from office to residential decreased gradually, as did the number of applications for change of use from agricultural to residential.
Since the changes to permitted development rights in 2015, the total number of applications has been on a downwards trajectory.
However, following the introduction of new permitted development rules in Autumn 2019, many developers and homeowners decided to extend, and the number of applications rose slightly.
Ben Lloyd, co-founder of Pure Advisory Group, said: “We will undoubtedly see a rise in permitted developments over the next 36 months as there will be an unusual amount of business closures in the UK across a variety of sectors, meaning units will become vacant where they were previously let or owner occupied.
“This will undoubtedly wash more availability into the sales market at both steady market values and at discounted levels where I expect there to be an influx of motivated and distressed sellers entering the market.
“In turn, we will see the more opportunistic investors looking to acquire and redevelop alternative properties that will need change of use.
“The stars are going to be pretty well-aligned for opportunistic investors in the change of use real estate space.
“Exactly how distressed the market will become will no doubt be determined by ongoing state support of businesses and the general state and elasticity of the sectors they are in coming out of that support.”