There’s a lot of confusion among property developers and planning professionals about whether Houses in Multiple Occupation (HMOs) are exempt from Biodiversity Net Gain (BNG) rules.
The short answer?
HMOs are not automatically exempt — but many individual HMO projects end up being exempt in practice, depending on the scope of works.
Below we explain why.
What the Law Actually Says
Under the Environment Act 2021, the Government introduced a mandatory requirement for most new developments to deliver at least a 10 % Biodiversity Net Gain.
This legal requirement is now embedded in planning law via Schedule 7A of the Town and Country Planning Act 1990.
The supporting Biodiversity Gain (Exemptions) Regulations 2024 set out the limited types of development where BNG does not apply.
These include:
- Householder applications – such as small extensions, loft conversions, or domestic outbuildings.
- Developments entirely within existing buildings – no external or land-take impact.
- Permitted Development schemes – e.g. Class MA (commercial to residential) or C3 → C4 changes.
- Very small developments – affecting less than 25 m² of habitat or 5 m of linear habitat.
- Specific Crown or defence works.
Nowhere in legislation or Natural England guidance does it say that HMOs as a use class are exempt.
Why Developers Often Think HMOs Are Exempt
Most HMO conversions don’t need to provide a BNG calculation simply because:
- They involve internal alterations only – no new building footprint.
- The site is already 100 % developed, with no natural habitat to measure.
- The change may fall under permitted development (C3 → C4) rather than full planning.
In those cases, the Local Planning Authority (LPA) will usually record “BNG not applicable” because there is no habitat loss or creation to assess.
When BNG Does Apply to HMOs
BNG assessment is required where the HMO project includes:
- A new build or extension to an existing property.
- Hard-landscaping changes (paving, driveways, garden loss).
- Demolition and rebuilds on garden plots.
- Any proposal that changes the site’s surface or green area.
These projects still qualify as “small sites” under one hectare, so the Small Sites Metric (SSM) tool is used to calculate and demonstrate the biodiversity value before and after development.
Practical Summary
| Type of HMO Project | BNG Applies? | Reason |
| Internal conversion only | No | No habitat impact |
| Change of use under Permitted Development | No | Covered by PD exemption |
| Extension, rebuild, or new build | Yes | Habitat change or land-take |
| Garden redevelopment / new hardstanding | Yes | Affects baseline habitats |
Key Takeaway
The HMO use class (C4) does not create a legal exemption from BNG.
It’s the physical impact on land or habitats that determines whether a BNG assessment is required.
If an HMO scheme alters gardens, hard surfaces, or external areas, the LPA can request a Small Sites Metric calculation or BNG Statement to show how biodiversity will be improved.
For internal-only conversions, the development will normally qualify as BNG-exempt because it has no measurable ecological effect.
How WorkSmartGPT Can Help
WorkSmartGPT Ltd provides:
- BNG Statements for small residential and mixed-use schemes.
- Small Sites Metric (SSM) calculations.
- MAGIC mapping and policy review for LPAs.
- Planting and enhancement schedules to achieve the 10 % target where required.
If you’re unsure whether your HMO or conversion project requires a BNG assessment, we can review your drawings and confirm this quickly — usually within 24 hours.