The Government announced on 19 February 2024 that new controls will be introduced on holiday lets in England from the summer, to help people afford to live within their local communities. Amanda Marwood, partner, and Zakira Vika, solicitor, from our commercial property team look at what this means for the tourism sector.
Why changes are being made?
Recent years have seen a significant increase in the number of people purchasing properties in popular tourist destinations for use as holiday lets.
This surge has been fuelled by the popularity of advertising platforms such as booking.com and Airbnb, that make it extremely easy to run as a profitable business.
The coronavirus pandemic further fuelled this trend as it triggered a boom in domestic breaks and holidays. This is something that has continued during the cost-of-living crisis.
Campaign group Generation Rent said that the result of this is that “families are being driven out of their communities by the disastrous loss of homes into holiday lets, with over 35,000 privately rented homes lost to Airbnb-style short-term lets since 2019.”
This was further reiterated by the housing secretary Michael Gove who said that “too many local families and young people feel they are being shut out of the housing market and denied the opportunity to rent or buy in their community”.
What are the new proposals?
There are two main proposals by the government:
- Local authorities will have the power to require planning permission for future short-term lets/ holiday rentals if they deem this necessary.
- A mandatory national register will be introduced to provide local authorities with information on short-term lets/holiday rentals in their area.
The proposed changes would create a planning use class for these short-term lets that are not used as a person’s sole or main home.
The mandatory national register would allow local authorities to monitor the use of properties, the impact of this use on the local area, and whether health and safety rules are being complied with.
However, there are some key points to note:
- Hotels, hostels, and B&Bs will not be affected by the changes.
- Existing short-term lets will not require planning permission and will be automatically reclassified.
- The new rules will not apply to people who let out their main home for up to 90 nights a year.
- The government is also looking at how to ensure the register does not apply disproportionate regulation – for example on property owners that let out their home infrequently.
It remains to be seen how the Government’s proposed changes will impact the tourism sector when introduced in the summer.