Planning regulation on the way for Airbnb

  • Insight

15 May 2019

If you manage a short term holiday let, either through Airbnb or another online marketplace, planning regulation may be on the way. 

Short term holiday lets (STHL) or holiday rentals are in strong demand across Scotland, with more than 9,000 properties alone listed by Airbnb in Edinburgh. It is clearly an important aspect of the tourist economy and remains in demand, with stays mostly ranging from a number of days to a week.

STHL can provide a good income for property owners, with higher rents and tenant flexibility and there is a considerable appetite to invest in properties for STHL. Operators of STHL and those seeking to invest should be aware of likely impending regulation. Many local authorities are now taking planning enforcement action to stop STHL following their perceived impact on the availability of affordable housing and complaints by permanent residents.

Planning permission?

Section 11B of The Planning (Scotland) Bill (as amended at Stage 2) seeks to control ‘short term holiday lets’ (STHL) by declaring them as involving a material change of use requiring a specific grant of planning permission. There are exceptions where the property is let under a residential lease or the property remains the sole or main residence of the landlord or occupier. 

This amendment, introduced by Andy Wightman MSP, may or may not be included in the final Bill and Act although regulation of the STHL market now seems very likely. The Scottish Government have embarked upon a consultation on short term lets and the First Minister used her speech at the recent SNP conference to announce the Government’s intention to regulate this market.

There’s also been growing concern amongst planning authorities over the need for regulation in this area, and in particular the need for a specific grant of planning permission to operate STHL. Planning authorities in Edinburgh and Glasgow are of the view that operating a STHL is a ‘breach of planning control’ which could justify them in taking enforcement action to stop STHL. Both planning authorities maintain that that the use of a property as a STHL, as opposed to a sole or main residence, is materially different in character. Their concern is additionally based on amenity impacts on neighbours (particularly where there is a common stair), loss of otherwise affordable rental accommodation, price inflation and overall lack of regulation.

Those promoting STHL are clearly providing essential affordable accommodation for tourism and business.  They will not welcome the uncertainty of being subject to enforcement or having to apply for planning permission in circumstances where this may be refused by planning authorities.

A number of planning authorities are considering or have taken enforcement action to stop it. Under the common law (case-law) the change of use from private dwelling house to STHL could (rather than will always) amount to a material change of use requiring planning permission, but this is a question of facts and circumstances.

Useful planning law cases

An important case in this area is Moore v Secretary of State for Communities and Local Government [2012] EWCA Civ 1202. Although this case was in England, it is persuasive in terms of Scottish planning law. Whether a material change of use has occurred is a question of fact and degree. 

The answer depended on the particular characteristics of the use as holiday accommodation. It was not correct to say that using a dwelling house for commercial holiday lettings would always amount to a material change of use; nor was it correct that it could never amount to a change of use. 

In this case the inspector identified the following factors as relevant: 

  • the pattern of arrivals and departures, with associated traffic movements 
  • the unlikelihood of occupation by a family or household group
  • the numbers of people constituting the visiting group on many occasions 
  • the likely frequency of party type activities and the potential lack of consideration for neighbours

On that occasion the inspector considered that use of the property as part of the appellant’s holiday letting business was a material change of use. 

Another important case is Gravesham BC v Secretary of State for the Environment (1982) 47 P&CR 142, which considered the meaning of ‘dwelling house’ and concluded that the distinctive characteristic was its ability to afford to those who use it the facilities required for day-to-day private domestic existence. The court firmly rejected the notion that such a building ceased to be a dwelling house because it was occupied only for part of the year, or at infrequent or irregular intervals or by a series of different persons. 

Guidance?

It’s difficult to give clear guidance, although urban properties which are let permanently and exclusively for STHL will be the most vulnerable to enforcement action. Holiday homes used for short term lets in the countryside may also be vulnerable. The real difficulty is uncertainty on when the use has materially changed, particularly where the use is not for full-time STHL. The Planning (Scotland) Bill makes provision for Scottish Ministers to issue statutory guidance on the meaning or limits of STHL which would be very helpful in clarifying when a material change of use has or has not occurred.  

Flats accessed by a common stair would appear to be treated differently from dwellings with their own access on the basis that there will be no or considerably less impacts on permanent residents. In Greater London STHL is now permitted as long as the total number of nights does not exceed 90 in a single calendar year and at least one of the persons providing the STHL is liable to pay council tax. In addition to planning control the Scottish Government may be seeking to further regulate STHL through controls similar to operating Houses in Multiple Occupation.