Demand for good shared housing is still there, and some specialist lenders are stretching further for experienced HMO landlords. But councils across the country are tightening the rules on new HMOs, so the planning check now matters as much as the mortgage.
What has changed this month
- Merseyside: Knowsley has voted to approve an Article 4 Direction, following Liverpool, Sefton and Halton. Wirral has asked its chief planner to look at a borough-wide direction (LandlordZone, 16 October 2026).
- Burnley: the council is consulting until 6 November 2026 on removing permitted development rights for small HMOs in six wards, with any change taking effect from September 2027 (Landlord Today, 9 October 2026).
- Cardiff: the council plans to renew its additional HMO licensing scheme in Plasnewydd for five more years. Since 2021, 878 properties have been licensed there and 84% needed improvements (Landlord Today, 12 October 2026).
- Lenders: Hampshire Trust Bank has raised its maximum loan-to-value on eligible HMO mortgages to 80%, aimed at experienced landlords building portfolios (Mortgage Solutions, 15 October 2026).
Why Article 4 matters to your mortgage
Normally, turning a family house into a small HMO (three to six unrelated tenants) does not need planning permission. An Article 4 Direction removes that right, so you need full planning consent first. Licensing is separate: a licence covers safety and room standards, not planning.
Lenders and valuers look at both. A property let as an HMO without the right planning or licence can be valued as a single house, which can cut the loan available, delay an offer or stop a refinance altogether. Getting the paperwork right before you buy protects your exit as well as your rent.
Lenders are still keen, with the right case
Higher loan-to-value options can help, but specialist HMO lenders typically want landlord experience, a clear licence position, sensible room sizes and a realistic rental figure from the valuer. Criteria differ a lot between lenders, which is where a whole-of-market broker earns their keep.
Quick tips
- Check the council's Article 4 map and HMO licensing rules before you offer, not after.
- Ask the seller for the planning history, current HMO licence and fire safety certificates.
- If a council is consulting now, plan your timeline around the date a direction could take effect.
- Budget for licence fees and any upgrade works in your stress test.
- Keep a portfolio schedule up to date; lenders ask for it on every HMO application.
See how we helped a client refurbish and refinance an HMO in Coventry, read our HMO mortgages page, or download one of our free guides. Our CeMAP-qualified advisers can check lender appetite for your property before you commit. Most buy-to-let and HMO mortgages are not regulated by the FCA.
Sources
- LandlordZone: HMO crackdown spreads across Merseyside (16 October 2026)
- Landlord Today: Another council clamps down on spread of HMOs (9 October 2026)
- Landlord Today: HMO clampdown likely for capital city (12 October 2026)
- Mortgage Solutions: HTB ups HMO lending to 80% LTV (15 October 2026)
- GOV.UK: House in multiple occupation licence
To talk it through, contact us or start your enquiry.
Important: This guide is general information, not personal advice. Rules, rates and lender criteria change; speak to an adviser about your circumstances. Your home may be repossessed if you do not keep up repayments on your mortgage.