Short term lets are promoted by a burgeoning industry as the answer to residential property owners’ prayers, but a new ruling means thousands of landlords may be operating illegally.
Serviced accommodation agencies and online booking sites like Airbnb promise a no-hassle way to make the kinds of fortune that traditional, buy-to-let landlords could only dream about.
But some senior industry professionals have always been sceptical, believing the sector has been built on smoke and mirrors, and now a new ruling by the Scottish Government may finally have burst the short-term let bubble.
In the first judgement of its kind, officials at Holyrood have banned owners of tenement and apartment block flats from leasing their properties as Airbnb-style lets.
The case was brought by Stephen McGlone, owner of Glasgow-based Westgate Estate Agents, who appealed against an enforcement notice issued by Glasgow City Council.
He claimed that operating his flat as an Airbnb did not constitute a ‘change of use’ from residential, but officials found in the local authority’s favour and its decision could have implications for thousands of property owners across Scotland.
Any Glasgow landlord familiar with council regulations will know that it has been forbidden to rent out an entire flat for short-term lets, including Airbnb, in a close with a communal entrance, since March 2017.
An individual room can be rented out if the owner remains living in the property. Otherwise, change-of-use planning permission is required and this may be refused, particularly in areas where there's a high density of rented flats, such as Crosshill, Shawlands and Strathbungo.
Short-term lets have been a hit with budget-conscious travellers but they are less popular among residents who find themselves continuously encountering strangers in communal areas.
Glasgow was the first city to introduce stricter rules on short term lets but Edinburgh, which has become a honeypot for Airbnb travellers attracted by thousands of online adverts, has now followed suit.
Gregor Cope, director of Scottish Property Centre Shawlands, said: “Airbnb style lets can seem like an easy way to make money, but they can be disruptive and intrude on the privacy of other people living in communal blocks.
“Switching from long-term to short-term letting, without applying for change-of-use, has been illegal in Glasgow for almost two years, but landlords may be unaware of this because it is only enforced when someone complains.
“This is the first case and it has resulted in the owner/letting agent being instructed to stop trading their property as an Airbnb.
“Given the publicity surrounding the case, there may be other people coming forward to complain.
“We would urge any landlord who may be unsure about their position to seek advice immediately to ensure they remain on the right side of the law.”
John Blackwood, Chief Executive of the Scottish Association of Landlords (SAL), told The Herald newspaper: “We must incentivise landlords to come back into the long-term market along with proportionately regulating short-term lets.”
An Airbnb spokesman said: “We regularly remind hosts to check and follow local rules. We have also been leading talks with the Scottish government on new rules for home-sharers and are actively engaged in ensuring that home sharing continues to grow responsibly and sustainably.”
For more information contact your local Scottish Property Centre branch or visit https://www.scottishpropertycentre.net