Airbnb

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Airbnb, the online accommodation marketplace, is changing its rules to prevent London-based hosts from renting out properties in excess of 90 days per year without the required planning permission.

Lisa Gibbs, Conveyancing Manager at Simpson Millar, examines this latest move and what it means for Airbnbers throughout London.

If you own your own home and have absolutely no qualms about complete strangers coming to stay there for a few nights, then Airbnb could be right up your street. With a reported 640,000 ‘hosts’ worldwide doing just that and with over 80million guest arrivals since its inception, Airbnb has proved to be the success its simple premise – allowing a stranger into your home in exchange for money – convinced cautious investors it wouldn’t be.

Change in Airbnb’s rules

The change in Airbnb’s terms will see hosts in London notified when they are close to the 90 day limit and blocked if they fail to get the appropriate extension, which will bring Airbnb’s offering into line with UK law. A law it is said councils lacked the resources and data to enforce.

Short term lets

Unlike an assured shorthold tenancy – a legal term for the main contract favoured by landlords, generally lasting 6 or 12 months – a short term let refers to an agreement that is under 6 months and can be as little as a single night. Up until 2015, short term lets of up to 90 days were illegal in London unless planning permission was applied for. This was in contrast to the rest of the country and due to a law stretching back to 1973.

De-regulation of the market, a response to the rise of short term accommodation sites such as Airbnb and OneFineStay, saw the law change, allowing London hosts to rent out property for up to 90 days before having to apply for the necessary permission.

Lisa Gibbs comments:

“The success of Airbnb has been phenomenal and its popularity proves there is a market out there for this kind of service, allowing property owners to earn a little extra money renting out rooms or homes for short amounts of time.”

“But it has led to accusations of some professional landlords turning their properties into hotels by the back door. This they achieve by regularly exceeding the 90 day limit without the official consent required, and with a reported 23% of London’s ‘entire home’ listings having been let out for 3 months or more, this is specifically what Airbnb’s new rule sets out to tackle.”

“The new measures will come into effect from spring 2017. They are a direct response to the complaints that have been made regarding the behaviour of some hosts and the effects their actions could have on the local housing market.”

“The IPPR (Institute for Public Policy Research) report, from which the 23% figure comes, also states that although the number of homes booked for more than 90 nights per year represented a relatively small proportion of the total housing stock, it was double that of the previous year.”

“The problem arises when the private rented sector becomes compromised by the number of landlords taking their properties out of the market and listing them as short term lets. The availability of rental properties is already overstretched throughout the UK and particularly in London, so there is a danger that the situation could become worse through the eagerness of many to capitalise on the returns short terming can offer.”  

“Airbnb’s move is a welcome one and putting the onus on the host to prove they have the correct permission to remain listed is a step in the right direction to ensuring the sustainability of London’s housing market.”

Written by Lisa Gibbs.

For more information on personal injury and the services offered by Simpson Millar, please call:

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