What landlords need to know as short-term lets licensing scheme moves into law - Stephen McGowan
If you let a property on a short-term basis, such as a residential flat, cottage, holiday home, or serviced apartment (in some circumstances), you will soon need a short-term let licence. This will apply whether you use a platform such as AirBnB or more traditional methods to let the property. Without the licence, it will be a criminal offence to let it on a short-term basis.
The purpose of this new scheme is to address perceived concerns over the safety of private residential properties being let for profit on a commercial basis, and the wider community impact on properties being used in this way, such as alleged anti-social behaviour and crime.
Every local authority in Scotland is introducing the regime. Some councils will be more restrictive than others and some property owners will find they are prohibited from using the property for short-term letting altogether, regardless of whether they have applied for a licence, due to a combination of new planning control zones, and local licensing policies.
The deadlines affected persons need to understand are as follows:
If you own an existing short-term let which has been taking bookings pre-1 October 2022, you have until 1 April 2023 to submit an application (evidence of use will be required). If you own a new short-term let where no bookings have been made prior to 1 October 2022, you can apply from that date, but cannot take bookings or guests until a licence is granted.
The application process is administered by the local authority, with decisions made by the authority’s licensing/regulatory committee. Applications will go through detailed consultation, with site notices being displayed, notification to neighbours, and consultation with responsible authorities such as Police Scotland. Applications will be called to a hearing at which the applicant would need to appear and convince the committee to grant the licence, and deal with any objections or adverse reports.
We believe there are three key areas that licensing committees will look to assess:
Safety of the property. Is it compliant under planning, with appropriate safety certificates eg gas/electric, fire and so on? Fitness of the applicant: a licence applicant will be exposed to a personal “fit and proper test” For example, if you have convictions these would need to be declared. Impact on the local community - a wider test which may take into account your existing relationship with your neighbours and if there are, for example, any noise complaints.
Some types of property may benefit from an exemption. These include:
Long-term let premises which are certain type of legal tenancies, such as protected tenancies, assured tenancies, short assured tenancies, crofts, Scottish secure tenancies, various agricultural tenancies. Premises with an alcohol licence. Hotels, hostels, care homes, student accommodation, a refuge, a bothy. Accommodation provided to employees in terms of their contract.
Each local authority will set their own fees. We estimate they will usually range from £300-£500. The licence will last for a maximum of three years and will require to be renewed, attracting a further fee. In some cases, local authorities will only issue one-year licences. Due to the complexity of the process, and attendance at a hearing, we anticipate many owners will rely on specialist licensing solicitors to assist and steer them through the minefield.
Stephen McGowan is Head of licensing (Scotland) at TLT
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