From the start of October, the Scottish Government required all of its local authorities to have a short-term lets licensing scheme in place.
The aim being to ensure short-term lets are safe and that concerns from people living in some areas of the country about their impact on housing supply in those local communities, are met.
Aims of the Licensing of Short-term Lets Order 2022
When fully operational in April next year, the licensing system will have three main, positive impacts.
It will help to protect existing communities in areas with high visitor numbers through the management of short-term let licences, providing local authorities with an understanding of activity in a particular area and ensuring an appropriate number of licences are allocated.
Not only will this enable local housing decisions to be made on an informed basis, but it will help to balance housing need with business interests, whilst supporting the viability of important community services.
Levelling the regulatory playing field
Safety standards will also be elevated with mandatory licensing requirements. Unlike the private rented sector, which is required to comply with numerous health and safety measures, short-term lets have been less constrained and this is likely to have exacerbated their predominance in some areas.
The licensing system and corresponding safety requirements will represent additional costs to the sector, but they are unlikely to be prohibitive to legitimate short-term lets and perhaps, more importantly, they will recognise how the lack of regulation has incentivised investment in that area of the market to the detriment of homes available for longer-term rent.
What’s driving ‘Airbnb’ boom?
The huge growth in the short-term lets sector is highlighted in the most recent detailed research that revealed a trebling of short-term lets in Edinburgh, with the number of active listings on Airbnb across the entire UK up a third.
Landlords who offer short-term lets say they do so because of the burdensome regulations in the long-term letting market and the flexibility it offers them in how they use their property.
The Scottish Government is making a clear statement through the introduction of this licensing scheme that it considers health and safety to be paramount in whatever form of accommodation is being used.
This will help to create a more level regulatory playing field in which the needs of the short-term and private rented accommodation can be met and sustained.
