The idea
The HMO planning policy introduced by Labour as affects so called 'studentification' has already been reduced by this new government, but there are still Article 4 uses of the regulations that need to go.
This NIMBY policy creates 'fossilised studentifcation' in that once those who have a protected monopoly in an area for their own HMO, they are not going to let it go back to family usage. It discourages competition and investment and creates a false market.
The regulation lacks other mechanisms – e.g., council or housing association accommodation designed for families, or proper investment in purpose built student accommodation. Note that neither of these solutions incur a long term cost as they bring in rents too. Universities, councils and investment enterprises are quite capable of addressing this themselves without artificial social engineering as is attempted by these regulations.
It also disadvantages home owners who wish to let out their home on a periodic or medium term basis. This restriction can actually be a disincentive for families to move into an area. It also affects house prices in a way that is unfair to families – lowering the price by restricting the sales possibilities in an area where adjacent properties are fossilised into being HMO lets by this regulation.
The term 'studentification' is a pejorative which is underserved. The argument that the area goes quiet when student leave is not much of an argument. It probably originates with a few shop owners who do quite nicely when the students are there, but want a bit more business when they are not. Anyway, it's nice when it goes quiet!
This policy is ill-thought out and an undue interference. Get rid of it please. We don't need it.
Why is it important?
It is undue interference by a few NIMBYs,
it will not solve the problem (if it is a problem at all) but will fossilise it,
it is the kind of pointless regulation that we do not really need.