A new analysis suggests planning refusals for HMOs have doubled in the last five years – a period during which councils have stepped up licensing and other tactics to stop the spread of HMOs.

An analysis of 144 English councils by property company 1st Avenue shows the number of refusals has risen from 590 to 1,203. 

Approval rates were roughly static at 68% from 2021 and 2023 but fell during 2024 and 2025, with 2026 figures – so far – at 63%.

1st Avenue’s Paul Endacott says: “What we’re seeing here isn’t really a story about landlords versus councils, it’s a story about where people are actually going to live when the legal, regulated options start disappearing.

“Every time a licensable HMO gets refused planning permission or a licence application gets turned down, that demand for a cheap room in a shared house doesn’t vanish, it just goes somewhere else.”

One reason behind the growing number of refusals is the use of Article 4 directions by councils to remove permitted development rights that would previously have made it easier to set up HMOs. 

There is no central register covering Article 4 directions, but the National Residential Landlords Association estimates that around 75 to 80 English local authorities have introduced them.

Endacott continues: “The uncomfortable truth is that somewhere else is often less visible and less safe.

“We know from enforcement patterns over the years that when regulation tightens around larger, more visible HMOs, some operators simply shift into smaller properties or informal arrangements that fall outside a council’s usual inspection regime.”

At the same time there has been much stricter licensing of existing HMOs by local authorities – Letting Agent Today and sister publication Land Today have carried numerous reports of councils strengthening licensing regimes.

Endacott says licensing is important because it covers the likes of fire safety, room sizes, and basic living standards.

But he says councils should distinguish between tackling genuinely poor accommodation and restricting well managed HMOs that provide valuable rental housing.

“Councils are absolutely right to clamp down on poor-quality, overcrowded HMOs run by genuinely rogue landlords.

“But there’s a risk that blanket restrictions, particularly Article 4 directions covering entire towns or boroughs, end up filtering out well-managed shared housing alongside the bad, leaving tenants with fewer safe, legal choices rather than better ones.”

And he concludes: “Until local and national policy properly reconciles the demand for affordable shared housing with the drive to raise standards, we’re likely to keep seeing this tension play out.

“Renters deserve housing that is both affordable and safe, and right now, an awful lot of them are being asked to choose between the two.”