Four different levers got pulled today, and none of them were licensing in the usual sense. Stoke-on-Trent wants to switch off HMO conversions by right across the whole city, a tax tribunal handed Property118 a substantive win on the tax-scheme disclosure rules that still leaves each landlord’s own tax position to be resolved case by case, the year’s Right to Buy figures landed with a 90% jump that says more about the housing stock changing hands than the politics driving it, and a Lancashire landlord found out that ignoring a warning letter about rubbish is not a victimless decision. Stacked together it’s a fair cross-section of how control over property actually gets exercised: planning rights, tax law, market incentives and old-fashioned environmental health.
Stoke-on-Trent wants to switch off HMO conversions by right
Stoke-on-Trent City Council published proposals on 4 August for a city-wide Article 4 Direction removing the permitted development right to convert a family home into a small HMO without planning permission, as the council’s own announcement confirms. Alongside it comes a tiered concentration-cap system: no new HMO where they’d push the total above 5% of homes within a 50-metre radius, ward-level ceilings of 4%, 2.5% or 1.5% depending on how saturated an area already is, a ban on side-by-side HMOs sharing a single frontage, and a rule against sandwiching an ordinary home between two HMOs. A separate additional licensing scheme for smaller HMOs currently outside mandatory licensing is also proposed, subject to consultation. Cabinet is due to consider the package next week. Councillor Duncan Walker, cabinet member for safe and resilient communities and housing, put it plainly: “Houses of multiple occupation have a place in terms of meeting housing needs – they need to be strictly controlled.”
My read: this is still a cabinet recommendation, not a decision, and even once adopted an Article 4 Direction doesn’t usually bite overnight — made in the standard way it typically needs twelve months’ notice, and a council that wants it to land sooner has to make it with immediate effect, which opens the door to compensation claims from anyone caught mid-conversion. What’s more interesting than the timing is the concentration-cap mechanism itself. It turns HMO viability into a question of what’s already on the street around a property, not just what the building can support, which is a genuinely different appraisal exercise to the one most small investors are used to running.
Anyone with an HMO conversion in Stoke sitting in the pipeline should treat this as the signal to get the planning application in now rather than betting on permitted development surviving the year. Anyone running a smaller HMO in the city that currently sits outside mandatory licensing should watch for the separate additional licensing consultation — that’s a different fight to the Article 4 one and worth responding to on its own terms.
The Property118 tribunal win: what it decided, and what it didn’t
In February 2024 HMRC issued Scheme Reference Numbers under the DOTAS disclosure rules against Property118’s Substantial Incorporation Structure — its model for moving landlord portfolios into corporate ownership — and its companion Capital Account Restructuring arrangement, on suspicion the arrangements sidestepped the Section 24 finance-cost restriction. A separate Stop Notice followed in July 2024, directed at the Capital Account Restructuring arrangement specifically. The First-tier Tribunal has now ruled in Property118’s favour after a ten-day hearing and cancelled the Scheme Reference Numbers — the full judgment is at [2026] UKFTT 1111 (TC), and Mortgage Solutions reports the outcome. Founder Mark Alexander says landlords had “commercial reasons” for incorporating beyond tax, pointing to mortgage preservation and refinancing costs.
My read: this wasn’t a win on a technicality, and it’s worth being precise about that. The tribunal heard ten days of evidence and decided the statutory DOTAS descriptions on their merits: it accepted substantial commercial reasons for both arrangements and found the tax benefits were a main purpose but not the main purpose, treated the lending and brokerage charges as ordinary commercial fees rather than a premium for tax planning, found nothing “unusual or contrived” in the bridging-loan steps, and — on incorporation relief specifically — found the structure could enable a landlord to obtain the relief in full where they might not have obtained it after a refinancing. What the ruling didn’t do is determine any individual landlord’s own tax position: whether a particular client’s claim to Section 162 relief, their stamp duty treatment or the trust arrangements underneath it all hold up wasn’t the question in front of the tribunal, and Property118 itself has been clear the judgment doesn’t decide those. Tax barrister Dan Neidle at Tax Policy Associates — who argues the tribunal got the DOTAS analysis wrong — makes the further point that HMRC’s open enquiries into individual landlords’ returns, some running past six figures, continue regardless. A substantive win on the disclosure question and a determination of each client’s tax position are two different things, and this ruling delivered the first, not the second.
If you’ve incorporated through this route or something similar, or you’re being pitched incorporation as a Section 24 workaround, the ruling genuinely helps the argument that these structures serve commercial purposes — but it doesn’t decide whether your own relief claims succeed, and any open HMRC enquiry into your returns carries on regardless. Get independent tax advice on your own circumstances before relying on it, and don’t expect lenders to change how they assess incorporated portfolios off the back of it — none reportedly have.
The Right to Buy jump that should worry whoever’s valuing the stock
GOV.UK’s latest official statistics, published today, show 14,275 homes sold under Right to Buy in England in 2025-26, up 90% on the year before, with councils banking £1.61bn in receipts (up 99.6%) at an average of £112,900 per sale, while the number of replacement homes funded from those receipts fell 7% to 3,452. Moneyfactscompare’s Rachel Springall, quoted by Mortgage Solutions, points to the Social Housing Bill working through Parliament — third reading expected in September — as one reason buyers may be moving now rather than waiting for reform to bite.
My read: the discount and reform politics get the headlines, but what actually lands on a surveyor’s desk is the stock itself. A 90% jump in completions in a single year means a lot more 1950s-80s council-built housing changing hands at once, and a meaningful slice of that generation is non-traditional construction — no-fines concrete, steel-framed, Airey, Cornish Unit, large panel system — that mainstream lenders won’t mortgage without a specialist survey and that a standard valuation won’t flag. Buyers exercising Right to Buy are usually first-time purchasers of that specific property, with no prior reason to know it’s anything other than an ordinary house.
If you’re buying under Right to Buy, ask the council for the construction type before instructing anyone. If the answer isn’t traditional brick or block, don’t let a mortgage valuation stand in for a proper survey — a HomeBuyer or full building survey will actually look at what the walls are made of, which for this generation of stock is the whole question.
When a warning letter about rubbish ends up in court
Blackburn with Darwen Council’s environmental crime team prosecuted landlord Joseph Giovanni after piles of rubbish at three of his rental properties in Darwen — on Sudellside Street, Olive Lane and Higher Church Street — attracted vermin and drew complaints from neighbours, as LandlordZone reports. The council says it offered advice and sent repeated letters before serving formal warning notices under the Anti-Social Behaviour, Crime and Policing Act 2014 and the Prevention of Damage by Pests Act 1949; when those were ignored too, the case went to court, and Giovanni was ordered to pay more than £4,500 in fines, costs and the victim surcharge across the three properties. Councillor Jim Casey, the council’s executive member for environment: “This case demonstrates that we will take firm action where individuals fail to meet their responsibilities and allow environmental problems to negatively affect local communities.”
My read: what’s notable here isn’t the offence — rubbish and vermin at a rental property is a familiar enough complaint — it’s the toolkit. This didn’t run through housing legislation or an Improvement Notice at all; it ran through anti-social behaviour and pest-control powers instead, and because it covered three separate addresses under one landlord, the penalties stacked into a single prosecution. Councils increasingly treat a pattern across a portfolio as an aggravating factor worth pursuing together rather than three separate minor cases.
The practical lesson is about the first letter, not the last one. A landlord who responds properly the first time an environmental health or environmental crime team makes contact — even about something that feels like a tenant-management issue rather than a defect in the building — avoids the escalation ladder entirely. Ignoring it doesn’t make it go away; it just moves the file from advice to prosecution.
What I’d actually do
- HMO conversion in the pipeline in Stoke-on-Trent? Submit the planning application now rather than betting permitted development survives past cabinet next week.
- Considering landlord incorporation as a tax move? The Property118 tribunal win was a substantive ruling on the DOTAS disclosure question — but it didn’t determine any individual landlord’s entitlement to incorporation relief or their stamp duty position, so get independent advice on your own circumstances before relying on it.
- Buying a property under Right to Buy? Ask the council for the construction type before instructing anyone, and commission a proper survey rather than relying on the mortgage valuation if it isn’t traditional brick or block.
- Had a warning letter from an environmental health or environmental crime team? Respond properly first time — councils are stacking penalties across a whole portfolio when early letters get ignored.
If today’s notes have you weighing up a Right to Buy purchase of uncertain construction, an HMO conversion in Stoke-on-Trent, or just want a second opinion on a portfolio decision, the practice offers full building surveys and Buy to Let Surveys across the South East. Get in touch.
Updated 24 August 2026. The section on the Property118 tribunal ruling has been corrected: the July 2024 Stop Notice related to the Capital Account Restructuring arrangement, not the Substantial Incorporation Structure; the ruling is now described as what it was — a substantive decision on the statutory DOTAS descriptions, reached on the merits after a ten-day hearing — rather than as procedural; and the tribunal’s finding on incorporation relief at paragraph [151] of the judgment is now reflected. A link to the full judgment has been added.
Small print. General commentary, not advice for your specific circumstances — regulations, schemes and deadlines change, and your property is not the average property. Sources linked were accurate when read on 8 August 2026.