Whether you’re a first-time homebuyer, a seasoned investor, or someone looking to expand their property portfolio, understanding property classes is essential. Property classes, also known as ‘use classes,’ determine what a building or land can legally be used for. This system helps maintain order in property development, making sure that homes, businesses and other types of properties exist in suitable locations without infringing on each other’s space.
This article provides a detailed look into the different property classes, with a particular focus on residential classes, to help you understand how they affect your buying decisions and future plans for a property.
What Are Property Classes?
Property classes are a classification system used in the UK to regulate the types of activities that can occur in a particular building or on a specific piece of land. These classifications fall under the Town and Country Planning (Use Classes) Order 1987 (as amended) in England. Each class comes with specific rules about the type of activity permitted, ensuring a smooth coexistence between residential, commercial and industrial developments.
Knowing which use class a property falls into is important when buying or selling a property. This is because converting a property from one use to another may require planning permission, which could affect the ease or cost of a purchase or future renovation plans.
The Main Categories of Property Classes
Broadly speaking, property classes are divided into residential, commercial, industrial and other specialised use categories. Each of these has its own set of subcategories, but for the sake of clarity, we’ll focus mainly on residential classes.
Class C: Residential Use
For most of our readers, Class C properties are the most relevant because they relate to residential buildings. Let’s break down the key subcategories within Class C:
- Class C3 (Dwellinghouses): This is the most common class for those buying a standard home. Properties under Class C3 are single-family homes, including houses and flats. They are generally meant for residents living as a single household, with no more than six residents in total. First-time buyers or families looking for a home will most often come across properties in this category.
- Class C4 (Houses in Multiple Occupation – HMOs): Properties under Class C4 are used by small shared households, which are typically occupied by three to six people who aren’t part of the same family. An HMO often attracts property investors looking for rental income, particularly in student towns or cities with a high demand for shared accommodation. If you’re looking to buy a property to rent out to multiple tenants, understanding the rules around HMOs is vital, as additional licensing and regulations may apply.
- Sui Generis: While not a class in itself, properties labelled as ‘sui generis’ fall outside the standard classifications. Residential properties can sometimes fall under this term if they don’t fit neatly into Class C categories. For instance, large HMOs with more than six tenants, or properties used for more unique living situations, may be classified as sui generis. These properties often require special planning permission for any change of use.
Other Classes and Their Impact on Residential Property
Although Class C covers the bulk of residential properties, it’s worth noting how other property classes can impact residential buying decisions, particularly if you’re thinking about converting a non-residential building into a home or investing in mixed-use properties.
- Class E (Commercial, Business and Service): This relatively new class, introduced in 2020, consolidates a variety of previous use classes into one. It covers everything from retail shops to restaurants and offices. While Class E is primarily commercial, its introduction has made it easier for developers to convert these properties into residential units, as fewer planning restrictions apply.
- Class F (Local Community and Learning): Class F properties are reserved for public and community use, such as schools, nurseries and places of worship. Again, with the right planning permissions, properties in this class can sometimes be repurposed for residential use.
Why Property Classes Matter for Buyers and Investors
Understanding the use class of a property can have a big impact on your buying decision. For instance, if you’re buying a residential property, it’s important to know whether it falls under Class C3 or C4, as this could affect what you can legally do with the property. Similarly, if you’re interested in purchasing a commercial property to convert into residential space, being aware of the planning rules associated with changing from Class E to Class C3 is essential.
Investors, in particular, should pay close attention to these classifications, especially when buying HMOs or properties in areas with high student populations or demand for shared accommodation. The rules around licensing and planning permission can vary by local authority, so always make sure you’re clear on the requirements before purchasing.
How to Change a Property’s Use Class
If you’re looking to change the use class of a property — for example, converting an office building (Class E) into residential flats (Class C3) — you’ll likely need to apply for planning permission from your local council. This can be a complex process, but it’s often a key step in the development of certain properties. It’s also worth noting that some changes of use are allowed under Permitted Development Rights (PDR), which means that planning permission isn’t always required. However, PDR doesn’t apply to all properties, so it’s important to check the specific regulations for the property you’re interested in.
Why Understanding Property Classes Is Key
Whether you’re buying your first home, looking to invest in rental properties, or considering a commercial-to-residential conversion, understanding property classes is crucial. Not only does it help you identify the types of properties that best suit your needs, but it also ensures you’re aware of the regulations and permissions required for any future changes you might want to make.
At Newton Fallowell, we specialise in helping buyers, sellers and investors navigate the complexities of the property market. If you have questions about property classes or are interested in finding the perfect property for your needs, don’t hesitate to get in touch. Our expert team is here to guide you every step of the way.
