The long-term threat of short-term lets

The London Councils cross-party group is fighting short-term lets, after the stark findings that one in 50 homes in central London is being let out on Airbnb-esque rental platforms. For the PRS industry, it is a welcome ally, helping to publicise the risk of short lets: using up valuable housing stock, driving up prices and creating pockets of crime. As a major residential landlord in central London, we’re very familiar with the impact of the Airbnb/short-term let phenomenon. Short-term lets are expressly forbidden in all of our new tenancy agreements. This isn’t because we’re killjoys, but because we cannot ensure the safety of a building’s occupants if we don’t know who is in it.  Horror stories about the mistreatment of properties which have been booked out via short-term let platforms are well documented. And, of course, people using these properties for short visits to the capital are often in ‘holiday mode’ which invariably does not make them great neighbours in terms of noise and comings and goings. These guests are a risk: they don’t understand basic safety procedures or who to contact if something goes wrong. We have also uncovered cases of serious overcrowding, including one instance where a large family arrived for a two-week holiday in a small flat. This compromises the safety and wellbeing of both the visitors and others in the building. And, of course, there is the increased likelihood of noise nuisance causing genuine distress to permanent residents. Under the radar When you consider the raft of rules and obligations that residential landlords must comply with, it makes no sense that someone can let a property without those applying to them simply because these are short-term lets. Surely the consumer needs to be safe and protected regardless of the duration of stay? Short-term lets are depriving boroughs of crucial permanent housing supply which in turn drives up prices in the private rental sector, making areas unaffordable and increasing the danger of people becoming homeless. Unfortunately, from a PRS perspective, most short-term lettings take place under the radar and without the knowledge or prior consent of the landlord. The reality is that not much currently exists in terms of short-term let legislation. As it stands, planning permission is required to rent out homes on short lets for more than 90 nights per year. However, councils have made clear that they are unable to cope with the resourcing around the enforcement of this and, as a result, very few prosecutions have been made under this law. Turning tide Clearly more needs to be done here, but thankfully it looks like the tide does seem to be turning. Recently, the Scottish government announced that councils will be able to introduce licensing schemes for short-term lets from 2021. These will allow local authorities to establish designated areas where planning permission is required before properties can be rented out. It will also set safety requirements and review how short-term lets should be taxed in the future to ensure they make an “appropriate contribution to local communities and support local services”. This a step in the right direction, but again, as with most regulatory issues in the residential sector, it all falls back on enforcement and resourcing. Many councils have called for a data-sharing registration scheme of short-term lettings, which would deter anti-social behaviour associated with the ‘party house’. Brighton and Hove council is lobbying for landlords using short-let platforms to be charged business rates, as they argue that it has an unfair advantage compared with hotels and regular B&Bs. This brings into focus the data that Airbnb and its imitators are holding. If you make that transparent, then councils and private landlords could easily cross-reference against their own properties and take appropriate action. We strive to curate a neighbourhood where residents have a stake in their environment. Our view is that short stay visitors have an array of alternative options in the area and we would rather see our portfolio used to create real homes. Tracey Hartley is residential director at the Howard de Walden Estate