Converting a house to an HMO in Liverpool: Article 4, licensing and what it costs

Short answer: in most of Liverpool, converting a family house into a small HMO will soon need a planning application rather than being permitted development. Liverpool City Council already has Article 4 directions over eleven inner wards and the Dales. In October 2026 it is making five further directions with immediate effect, covering Kirkdale, Everton North, County, Walton, Orrell Park and part of Fazakerley, along with parts of Tuebrook, Old Swan, Penny Lane and Sefton Park. A city-wide direction covering everywhere else follows in October 2027. Mandatory HMO licensing applies to any house with five or more occupants in two or more households, regardless of the planning route.

The planning picture: C3 to C4 and Article 4

A house with three to six unrelated occupants sharing facilities is a small HMO, use class C4. Nationally, changing a house (C3) to a small HMO is permitted development under Class L, so no planning application is needed. A council can remove that right for an area with an Article 4 direction, after which the change of use needs a planning application.

Liverpool’s directions, as at October 2026:

• In force already: the Dales (since 2018) and eleven central and south wards (since 2021).
• Immediate directions, in force from the day the council publishes notice in late October 2026: Area 1 — Kirkdale West and East, Everton North, County, Walton, Orrell Park and part of Fazakerley North and West; Area 2 — part of Tuebrook Larkhill; Area 3 — Old Swan East and West and part of Stoneycroft; Area 4 — Penny Lane and part of Calderstones; Area 5 — St Michaels, Sefton Park and part of Festival Gardens.
• Non-immediate direction over the rest of the city: in force October 2027.

Seven or more occupants is a large HMO, which is sui generis and has always needed a planning application, Article 4 or not.

The council’s evidence for the extension was a study showing small HMOs grew 15 per cent inside the existing boundary over three years against 57 per cent outside it, with County ward adding 65 and Walton 26. The policy test for applications in Liverpool is whether the house can still function as a family home and whether the street is already saturated with HMOs, and recent decisions on the council’s portal show both being applied.

What that means if you are buying now

• Check the exact address against the council’s maps first. Ward boundaries matter: part of Fazakerley is in, part is not, until October 2027.
• A certificate of lawful proposed use does not protect you once a direction is in force unless the HMO use has actually started. Appeal decisions elsewhere have confirmed that.
• Where a direction applies, budget for a planning application and the time it takes, and appraise the deal on the assumption it might be refused.
• Outside Liverpool, Sefton has its own Article 4 directions over parts of the borough and Knowsley currently has none, so the same house a mile over the boundary can be on a different footing.

Licensing

Any HMO with five or more occupants forming two or more households needs a mandatory HMO licence from the council, whatever the planning position. Liverpool runs mandatory licensing and the application goes in once the house is occupied. The licence sets the maximum number of occupants and carries conditions on fire safety, amenities and management. Gas safety, an electrical installation certificate, a fire risk assessment, fire alarm certification and an EPC of E or better all have to be in place to let lawfully.

Room sizes: the legal minimum and the one that lets

The legal minimum bedroom size under the licensing regulations is 6.51 square metres for one adult and 10.22 for two. Those numbers are a floor, not a target. We will not build a room under 12 square metres and aim for 14 or more, because the tenants we build for — hospital staff, mostly — will not take a box room, and a house full of small rooms is a house full of voids. If a property cannot give six rooms at that size we say so at the first visit.

What a conversion has cost us

Our full six-room conversions, with a rewire, replumb, new boiler and cylinder, an en-suite to every room, in-room kitchenettes, a shared kitchen and living space, Grade A fire alarm, fire doors, LVT flooring and decoration throughout, have been priced between £150,000 and £186,000 including VAT. That is for a house needing the internal conversion only. A dormer to get the sixth room adds roughly £44,000 to £60,000; a single-storey rear extension runs about £3,000 per square metre; a full re-render with insulation £18,000 to £20,000. Building regulations fees have been around £1,800. Sixteen to twenty weeks on site has been typical.

How we run one

1. Appraisal. Article 4 check on the address, room count at our minimum sizes, an honest view on the numbers.
2. Design. Layout agreed room by room on site; architect’s drawings and structural calculations where needed; building control notified; planning or lawful development certificate as the address requires.
3. Build. One site manager, our own trades, weekly progress photographs, snagging as we go.
4. Handover. Marketing starts before the build finishes; the licence is applied for once the first tenant is in; you get the full compliance pack; LivLux lets and manages the house if you want it to.

Service page: HMO conversions in Liverpool for investors.

Sources: Liverpool City Council Cabinet report on Article 4 directions, October 2026, and the council’s existing directions; the Licensing of Houses in Multiple Occupation (Mandatory Conditions of Licences) (England) Regulations 2018; the Town and Country Planning (General Permitted Development) (England) Order 2015, Schedule 2, Part 3, Class L. Our own figures are from L4 Property Developments quotations and valuations, 2025 to 2026.