How to transform a commercial premises into a residential one?
Converting commercial premises into residential premises requires notification to the appropriate district office or city hall with district status. To apply for a change of use, you must have documented legal title to the premises.
Commercial premises and business premises – what do these terms mean in the context of transformation?
A commercial premises is one type of commercial premises. In the context of formalities, you may also encounter terms such as "conversion of commercial premises to residential premises" or "change of use of commercial premises to residential premises." In this article, we discuss this procedure using commercial premises as an example.
To fully understand these mechanisms, it's worth checking the legal definition of a commercial property , as well as learning about other types of commercial premises . It's worth noting that Orange Real Estate offers commercial premises and commercial buildings located throughout the country .
Change of use of premises from commercial to residential - when does it require notification?
Any change in the use of a building or part thereof must be reported to the appropriate authority. This includes the commencement or discontinuation of any activity within the building that alters the conditions:
- health,
- work,
- hygienic and sanitary,
- fire or flood safety,
- the size or arrangement of loads.
Similar rules apply when an investor intends to carry out a complete change in the use of a building . This should be kept in mind when considering, for example , a commercial-residential building for sale, if the investor intends to significantly modify the proportions between its business and residential parts.
At this stage, it is worth analyzing in detail whether the commercial and residential building as an investment will be a profitable solution from the point of view of the planned rate of return.
What documents are needed to convert a commercial premises into a residential one?
Along with the application, the office must submit a number of attachments. In addition to the document confirming the right to occupy the premises, the following are required:
- certificate of compliance of the intended use of the building with the applicable local development plan (MPZP);
- a description and drawing (made on a map) specifying the location of the building in relation to the property boundaries and to other existing buildings, as well as those being built on this and neighbouring properties, with the designation of the part of the building covered by the application;
- technical description with the characteristics of the building, its structure and, if necessary, technical and operational data.
It's worth noting that the municipality hasn't adopted a local spatial development plan for a given area. In such cases , the investor is obligated to apply for a development decision before submitting the actual application. This document will confirm whether the intended residential function is consistent with the so-called good neighborliness principle and the spatial order in force in the area.
How long does it take to convert a commercial property into a residential property?
An application for a change of use notification for a building or part thereof, along with the aforementioned attachments, should be promptly reviewed by the district office or city hall. This process should take no longer than 30 days. If the application is found to be incomplete, it must be supplemented within the deadline set by the relevant authority.
If the office does not raise an objection, it can be considered to have given so-called tacit consent.
What are the next formal steps for converting commercial premises into residential premises after this deadline? After 30 days, you must apply to the office for a certificate of no impediments to the conversion and a certificate of the premises' independence. This is necessary to confirm the change in the premises' status and to make an entry in the land and mortgage register.
The investor has two years to complete these formalities. After that time, any change in the facility's use will require another notification.
How much does it cost to convert a commercial property into a residential property?
Submitting a change of use notification to the office is not subject to a stamp duty. However, key expenses involve compiling the appropriate documentation. The cost will depend on the specialists engaged to prepare the technical description, drawings, and opinions on the building's structure.
The total costs should also include any construction work, if adaptation to a residential function requires such intervention.
Tax considerations are also crucial from the perspective of the profitability of such a project. Commercial premises are generally subject to property tax rates that are several times higher than residential premises. Converting commercial premises into residential premises allows for the optimization of fixed maintenance costs.
Is it always possible to transform a commercial premises into a residential one?
Whether a commercial property can be converted into residential space depends largely on its exact location. Procedures for changing use are not the same everywhere.
To convert a commercial property into residential use, you must review the local zoning plan and verify whether the intended use will be consistent with it. Only then will your request for a change be approved.
Another issue is that changing the use of a building sometimes requires remodeling. Often, it's necessary to remove storefronts and install standard window frames. In the case of units located in multi-family buildings, the facade and exterior walls constitute a common part of the property. In such situations, any changes to the building's appearance must be preceded by obtaining consent from the housing association or housing cooperative. Such formalities can significantly lengthen the entire procedure.
FAQ - Frequently asked questions about converting a commercial premises into a residential one
Is it possible to convert commercial premises into residential premises?
Yes, if planning regulations allow it and if the premises meet the technical requirements for a residential function.
Can you live in a commercial property?
You cannot legally live in a commercial property without formally changing its use.
How long does it take to convert a commercial property into a residential property?
The Office typically has 30 days to file an objection to a complete application. After this time, if no objection is filed, the application is deemed to have received tacit consent.
How much does it cost to convert a commercial property into a residential property?
The cost depends on the price list of the specialists preparing the documentation, expert opinions, designs, and performing any adaptation work. Submitting a conversion application to the appropriate office does not incur any additional costs.
What application should I submit when converting a commercial premises into a residential one?
To convert commercial premises into residential premises, a change of use notification for the building or part thereof must be submitted to the appropriate authority. This is most often the district office or city hall for the given location (in the case of cities with district rights).