New Licensing Scheme Hits Edinburgh’s
Short-Term Holiday Let and Airbnb Landlords

If you’re an Edinburgh landlord with an Airbnb or a property that’s available for short-term let, the council’s new licensing scheme will have a significant impact.

Not only will you need to register before October 2023 (extended from the original deadline in April), but you’ll also have to make a planning application for change of use and meet stringent safety regulations that exceed those required for long-term property lets before you apply for the licence.

Consultation

The Scottish Government passed an act requiring local authorities to regulate short-term lets through licensing schemes and the City of Edinburgh Council put its plans out to consultation earlier this year.

The act was primarily designed to tackle issues with public orders offences and crime, but it will also be hoped by many to have a positive impact on Scotland’s growing housing problem. So many properties are now being used as holiday lets that this is seen by many as contributing to the lack of availability of homes in many towns, cities and some rural locations. Once the scheme is established, many properties are expected to be released back into the long-term rental market or sold.

Edinburgh’s licensing scheme came into effect on 1 October 2022. Any new operators of short-term lets are required to apply for and receive a licence before they can operate. Originally all pre-existing short-term let operators needed to apply by 1 April 2023 and be licensed by 1 January 2025, but applications have now been extended until 1 October 2023 due to the cost of living crisis. The council’s policy outlines the full details, which include temporary allowances for events such as the Edinburgh Fringe and major sporting occasions. However, these are the exception and must be applied and paid for several months in advance.

Planning Permission for short term lets

One of the biggest changes for landlords who let their whole property is the requirement to apply for planning permission for change of use from residential to short-term let.

The whole of the City of Edinburgh Council area is to be designated as a Short-term Let Control Area for the purposes of Section 26B of the Town and Country Planning (Scotland) Act 1997.

The use of an entire dwelling that is not a principal home (classified as Secondary Letting under the licencing scheme), as a short-term let will be a material change of use requiring planning permission, in accordance with Section 26B of the Town and Country Planning (Scotland) Act 1997 and The Town and Country Planning (Short-Term Let Control Areas) (Scotland) Regulations 2021.

This permission is a requirement of the new licence and is unlikely to be granted for tenement flats with shared entrances, which make up the majority of the Edinburgh’s Airbnb stock. Edinburgh City Council believes tenement flats are unsuitable as short-term lets due to their character and the likelihood of nuisance and anti-social behaviour in communal spaces such as hallways and stairwells.

The policy states:

• Secondary letting in tenement or shared main door accommodation is considered as unsuitable and there will be a rebuttable presumption against the grant of a licence in such circumstances

The only exception will be where the owner of the property can prove that all other owners sharing the same communal space are in agreement.

Safety requirements for Edinburgh short term lets

To apply for a licence, landlords must meet stringent safety requirements similar to those required for houses of multiple occupation (HMOs) and in excess of those needed for most long-term lets.

Evidence of the following must be provided, together with proof of planning permission and a lay-out plan of the property plus the appropriate fee:

• Annual Gas Certificate (for accommodation with a gas supply)
• Electrical Installation Condition Report
• Annual Portable Appliance Test Certificate

Landlords must also declare they have the following:

• Fire Safety Risk Assessment
• Energy Performance Certificate
• Building Insurance Certificate
• Public Liability Insurance Certificate
• Legionella risk assessment
• Annual Emergency Lighting Certificate

Licences for short-term lets will be granted for 12 months and new applications must be made annually, submitting updated safety certificates.

As Edinburgh’s leading letting agent Clan Gordon can provide impartial advice and guidance to landlords who are considering switching to long-term lettings due to the new requirements. We are particularly keen to speak to landlords who currently offer tenement properties as short-term lets and would like to find out more about the benefits of having longer-term tenants. Schedule a call to speak to one of our property management experts.