Edinburgh’s second homeowners face huge increases in council tax bills after the city council invoked new government powers allowing them to double the charge from 1st April.
In a move designed to ease pressure on Scotland’s housing market and bring more properties into circulation, Edinburgh City Council joined all but three of the country’s local authorities in introducing the higher charge on second homes.
Any property that is occupied for at least 25 days a year and isn’t a main residence is classed as a second home. The new ruling is expected to impact hundreds of properties across the city.
Short-term let licensing has changed in Edinburgh
The financial blow comes less than a year after the introduction of the new registration scheme for Edinburgh’s short-term lets, which has seen many owners forced to switch plans for their properties. Under the scheme, homes in blocks with shared entrances and hallways are generally deemed unsuitable as holiday lets and Airbnbs in a bid to reduce anti-social behaviour for residents and force more properties back onto the rental market.
So, what can second homeowners do to ease the financial burden of a double council tax bill? Short-term letting may seem like an option for some to generate an income to cover the increased charge, especially if they regularly use the property themselves. However, eligibility is significantly impacted by the short-term let licensing scheme.
Short-term letting also involves a great deal of organisation and coordination, with tenants frequently coming and going. There’s also the issue of holidaymakers not taking care of the property or treating it with the same respect as their own home.
Long-term letting options explained
Another option worth considering that provides a regular income is long-term letting. Homes are in short supply in the city, and here’s a ready stream of tenants looking for properties of all types. The latest Citylets market report found that 80% of one-bedroom flats up for rent in the first quarter of 2024 were let within a month, with the average time being just 18 days.
If you don’t use your second property on a regular basis but want to retain ownership rather than sell, finding reliable and reputable tenants is a good way to ensure it remains well-maintained and provides an income to cover the additional council tax charge imposed by Edinburgh City Council.
Using a letting agent to manage your rental property
And if you use the services of a letting agent, you can sit back and relax while the rent payments roll in and your property and tenants are taken care of. A full property management service means absolutely everything is looked after, from the tenancy agreement and safety checks to regular inspections and emergency calls. The cost is a small price to pay for not having to manage the day-to-day operation of the rental, and you’ll benefit from having someone with expertise to keep a close eye on your property.
And if you’re worried about not being able to sell your property or move in yourself once you have rented it out, there are strict guidelines to protect both tenants and landlords. You must give tenants notice of your intentions – details can be found on the Scottish Government website. All tenants are entitled to 28 days’ notice. Some may be entitled to up to 84 days.
Clan Gordon takes the hassle out of long-term letting with our family-run, award-winning property management service. We are focused on providing exceptional customer service to landlords across Edinburgh. For more information about long-term property letting, book a call with one of our expert property management advisors.