Introduction to the shake-up
- Last month the Scottish Government announced that all short-term let properties will require a licence to ensure they are safe and the people providing them are suitable.
- Local authorities will be required to establish a short-term lets licensing scheme by 1 October 2022, and existing hosts and operators will have until 1 April 2023 to apply for a licence.
- The Housing Secretary, Shona Robison, said:
“This legislation is a significant milestone on our path to bringing in an effective system of regulating short-term lets.
Our licensing scheme will allow local authorities and communities to take action to manage issues more effectively, without unduly curtailing the many benefits of short-term lets to hosts, visitors and the economy.
We have already introduced legislation allowing councils to establish short-term let control areas and manage numbers of short-term lets.”
- All short-term let properties will require a licence by 1 July 2024.
- Licensing fees will be set by local authorities to cover their costs in establishing and administering the scheme. Fees are likely to be in the range between £214 and £436 to cover a three year licence.
The relevant legislation
- As the Housing Secretary’s statement indicates there are two prongs to this.
The Licensing Scheme
- First, there is the new licensing scheme (“the Licensing Scheme”). (That is provided for in the Civic Government (Scotland) Act 1982 (Licensing of Short-term Lets) Order 2022/32 which comes into effect on 1 March 2022.)
- In short, if you operate a short-term let you will need a licence from the relevant local authority.
The Control Area Scheme
- Secondly, there is the short-term let control areas scheme which enables the council as planning authority to limit the number of short-term let properties in its area. (That is provided for in the Town and Country Planning (Short-term Let Control Areas)(Scotland) Regulations 2021/154 which came into force on 1 April 2021.)
- In short, if a local authority designates an area as a ”control area” then planning permission will be required in order to operate a short-term let.
- This note focuses on the Licensing Scheme.
Some pointers about the Licensing Scheme
- The legislation affects “short-term lets”. As so often with legislation there is an elaborate definition of the key term: in this case the definition runs to 18 lines!
- In particular, the legislation identifies three types of short-term let as follows: “home sharing”where you use all or part of your own home for short-term lets whilst you are there; “home letting” where you use all or part of your own home for short-term lets whilst you are absent (e.g. on holiday); and “secondary letting” where you let property in which you do not normally live (e.g. a second home).
- Scottish Government has provided some useful guidance (albeit currently in draft form) as to the ins and outs of the definition. That guidance can be found: Do you provide short-term lets? – Short term lets – licensing scheme part 1: guidance for hosts and operators – gov.scot (www.gov.scot)
- Broadly speaking, the way the legislation works is that all uses of residential accommodation for commercial gain are included unless they are specifically excluded.
Some of the exclusions
- Some of the main exclusions from the licensing requirement are as follows:
- Licensed accommodation, for example, if you operate a restaurant with rooms which is already licensed specifically to offer accommodation then you are not providing short-term lets.
- Accommodation provided by your guests, for example where they bring their own tent (as opposed to glamping where the tent is normally fixed and provided by the host).
- Health and care accommodation, such as residential care homes, hospitals and nursing homes.
- Educational accommodation, such as residential schools, colleges, training centres and purpose-built student accommodation. Student halls of residence, for example, are excluded but houses and flats which are normally let to students are not excluded.
A couple of examples as given in the Guidance
- “Bob owns and operates three properties in Glasgow which he operates as short-term lets. Bob must apply to Glasgow City Council for three separate licences, one for each property. Bob is found to be a fit and proper person and two of his applications are granted. However, one property is in a control area and for which Bob has not made an application for planning permission. The third application is refused, pending determination of a planning application for the property.”
- “Michael owns a property in the Highlands, and another in Perth and Kinross, both of which are operated as short-term lets. Michael must apply for a licence from Highland Council and another from Perth and Kinross Council.”
Note: This material is for information purposes only and does not constitute any form of advice or recommendation by us. You should not rely upon it in making any decisions or taking or refraining from taking any action. If you would like us to advise you on any of the matters covered in this material, please contact Andy Lindsay: email Andrew@mitchells-roberton.co.uk