Insight: The detrimental impact short-term lets are having on urban and rural Scotland - Dani Garavelli

Liz Haggard was in her 60s, and had lived in her Edinburgh tenement for more than 30 years, when two short-let party flats began making the lives of local residents hell. “It was a new social phenomenon linked to cheaper travel and the rise of the hen party,” she recalls.

“We had these quite terrifying parties - groups of 15 or 16 coming for two nights, vomiting and urinating in the stair. A whole raft of terrible behaviours. They would forget their keys and ring all the bells, but the main thing was always having strangers on your stairs. Not feeling safe in your own territory.”

This was back in the early 2000s, years before the launch of Airbnb made short-term lets (STLs) a blight in tourist hotspots across the globe, and it was clear The City of Edinburgh Council had little idea how to deal with it.

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But Haggard and her neighbours were determined not to be driven out. “We just kept at it, constantly phoning the police, contacting the council,” she says. “We needed to provide a lot of evidence and to be incredibly persistent, but we had support from [Labour MSP] Sarah Boyack and we got there in the end.” In 2013, the council obtained the first Management Control Order ever granted in Scotland under anti-social behaviour legislation and the flats were shut down.

A packed carpark this summer in Elgol, Skye. Picture: Peter Summers/Getty Images

In the meantime, however, the number of STLs had exploded. As Airbnb grew, the dreaded key-boxes - the international symbol of the STL - appeared in stairwells all over the city.

The phenomenon has had a detrimental impact on Edinburgh, as it has on Paris, Venice and Barcelona, hollowing out communities, forcing property prices up and feeding into a housing shortage. Owner occupiers and long-term renters, who once knew all their neighbours, find themselves living with a conveyor belt of strangers, who trundle their luggage up the stairs, and have no stake in the well-being of those who live there.

There were 10 children under 10 in Nicholas Munro’s block, always in and out of each others’ homes. But when one of the landlords decided to move from renting to a long-term tenant to advertising his property on Airbnb, that sense of a safe, self-contained space was violated.

“One time, we were blocked at the entry to our close by an American couple who were trying to get the perfect selfie,” says Munro, a widower who lives with his six-year-old daughter. “I had the weekly shop and my daughter was bursting for a pee. They avoided eye contact and let us wait while they took their pictures, checked their pictures, retook their pictures.” Another time his daughter came to report strangers smoking in the back green. “I didn't consent to commercialisation of our close, the landlord just went ahead and did it and as a result our quality of life changed,” Munro says.

Although the problem of short-term lets was already well-documented in Edinburgh, Covid laid bare the scale of it. As STLs were forced to stop accepting guests, some long-term residents found themselves the sole occupants of their block, increasing their isolation.

Now they are up and running again, there are fresh concerns about the spread of the virus. “There are residents who are experiencing a bizarre swing,” says Kirsty Henderson, a volunteer with PLACE, a grassroots organisation campaigning for the protection of livable and affordable communities. “During the pandemic they were living alone and now their block has started filling up with visitors from all over the country. They have a lot of anxiety about those strangers who won’t know there’s a vulnerable person there trying to avoid other people."

In Britannia Quay - a 341-flat development in Leith - life has become so stressful some owner-occupiers are moving out. Bonita Preacher, chair of the proprietors’ association, estimates there are now around 70 STLs across the complex’s 13 stairs.

“We have tried to create a community spirit; we have a Facebook page and get-togethers, but we are losing that as the number of short-term lets grows and people become more fed up,” she says.

“We have NHS workers who can't get any sleep because of the noise of parties which go on until 6 or 7am. There are half-drunk glasses lying around, sickness in the lifts and waste left where it attracts gulls and rats.

Preacher says it's a self-perpetuating problem. “Residents decide to sell and their properties are snapped up and turned into yet more short-term let accommodation.”

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STLs have been able to take hold in tourist hotspots because Airbnbs were supposed to be ad hoc arrangements: ordinary people renting out a space on their floor to occasional travellers, not commercial enterprises.

But landlords soon realised there was big money to be made. Instead of charging a permanent tenant £800 a month, they could charge tourists £1,000 a week. Soon, flats across the capital were being advertised on holiday accommodation websites.

Properties undergoing a “material change of use” - ie from domestic home to a business - are supposed to apply for planning permission, but few of the new Airbnb-type landlords bothered.

When STLs were causing a problem, residents could raise a complaint, but the onus was on them to gather evidence, and they often found themselves abused by the landlords they took on.

Over time, case law has accumulated and precedents have been set. Where planning permission is sought or retrospectively demanded, the presumption in Edinburgh is now against STLs in buildings with common entrances. But not everyone is willing to take on such a time-consuming and intimidating battle. As at Britannia Quay, many owner-occupiers simply sell up and move on.

And so STLs have spread. The most recent research suggests there are now more than 12,000 Airbnbs in the capital, with around a fifth rented out for more than 90 days a year. An estimated 10 per cent of the city’s 60,000 private rented sector (PRS) properties are now STLs, with the cost of buying and renting soaring.

According to a Citylets survey, the average cost of renting a property in Edinburgh is £1,000 a month compared to £803 a month in Glasgow. Only 14 per cent of homes in Edinburgh are social housing, compared to a Scottish average of 23 per cent. The money that can be made from STLs is also said to have exacerbated a shortage of temporary accommodation for homeless families.

In February, the Scottish Parliament passed legislation designed to make it easier for local authorities to manage the STL market. This legislation will allow councils to establish STL control zones. Within those zones, any property operating as a STL for more than 28 days a year will require planning consent. There will no longer be any need to demonstrate a material change of use. In addition, the Scottish Government hopes to introduce a mandatory licensing scheme which would force STL landlords to comply with health and safety and other regulations.

The City of Edinburgh Council wants to turn the whole city into a control zone, so the problem is not just pushed from one neighbourhood to another. It has put this proposal out for consultation. “I’m optimistic about the impact the legislation will have,” says housing convenor Kate Campbell. “Between the planning controls and the licensing regime, we hope to be able to manage not just basics such as health and safety, and making sure landlords are fit and proper, but maximum occupancy, antisocial behaviour and the type and concentration of properties across the city. I expect the overall numbers to come down significantly.”

But Henderson and others still have concerns. They worry the Scottish Government and local authorities are having to pit themselves against the might of global corporations like Airbnb, Expedia and Booking.com, and tourism lobby groups such as the Association of Scotland’s Self-Caterers (ASSC).

Although the legislation governing the creation of control zones has gone through, the proposals for the new licensing regime were withdrawn after a backlash by bed and breakfast owners who found themselves included when they thought they would be exempt.

The redrafted proposals will go back to the local government committee in November, but they still face fierce opposition. Earlier this month, the ASSC, Airbnb, the Scottish B&B Association and the UK Short term Accommodation Association resigned from the Scottish government’s Working Group on STLs, branding it “not fit for purpose”.

Fiona Campbell, chief executive of the ASSC, says the licensing proposals as they stand would materially damage the country’s tourism industry. She insists there has been a failure to distinguish between professionals and amateurs, and points out bona fide self-caterers provide £867m a year in direct spend and 24,000 jobs to the Scottish economy.

Last week, the ASSC highlighted alleged legal issues with the licensing proposals, suggesting they were incompatible with the Provisions of Services Regulations, European Convention on Human Rights, and the Scottish Regulator’s Strategic Code of Practice.

The organisation would prefer to see a registration scheme for established self-catering businesses which already comply with the regulations. This would allow them to self-certify instead of applying for a licence - a process Campbell says could cost them upwards of £1,500.

There are also concerns about delivery. The City of Edinburgh Council has struggled to enforce existing planning rules. The new control zones and licensing regime would create an even greater workload.

“The bottom line is planning authorities are understaffed and the market is racing away; they can’t catch up,” says former MSP Andy Wightman who has campaigned for the regulation of STLs.

To illustrate his point he says his office found 1,600 self-catering properties in Edinburgh registered for non-domestic rates on the valuation roll. Only six of these had planning consent.

“The council says it doesn’t know where all the STLs are - and it has a point - but it is a member of Lothian and Border joint valuation board, so it has this data," Wightman says. "It knows where these properties are and could have contacted them. That’s a measure of the extent to which local authorities lack the capacity to get on top of this.”

Henderson is concerned that, while The City of Edinburgh Council is aware of the impact of STLs, other local authorities might be less so. “We have our fingers crossed the licensing legislation is passed and the resources are there to ensure it is used in a meaningful way,” she says. “I believe Edinburgh will do that, but I worry some local authorities don’t realise the scale of the problems they have in their own areas.”

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While STLs tend to be associated with cities, they are also a problem in seaside resorts and rural getaways. The phenomenon has been intensified by Covid which has led to more people holidaying in the UK.

Iain McKee lives at Citadel Quay, an estate with 150 flats on Ayr Esplanade. He says a growing number of properties there and at neighbouring developments, Inkerman Court and Rowallan Court, are being turned into STLs, bringing the same types of anti-social behaviour experienced in Edinburgh.

The flats are advertised via Airbnb and elsewhere. Click on the Donnini Apartment website and you can book Arran View, a three-bedroomed apartment in Citadel Quay, for £175 a night or Harris Retreat at Inkerman Court for £150 a night.

“People arrive in the middle of the night, doors bang, there is drinking and noise,” says a man who has lived in one of the developments for more than a decade. “The flats are advertised for a certain number of people, but the second they are in you see others arriving with mattresses.

“The council says it can only target the individuals responsible for the anti-social behaviour but they are gone by the time any action can be taken. Meanwhile, the owners will not take responsibility for the behaviour."

McKee says Fort Residents’ Association - an umbrella group for the three estates - has been lobbying for action, without much success, though a meeting is scheduled for later this week. “We have been in constant contact with South Ayrshire Council, but they don’t seem to get it,” he says. “They don’t see the problem as similar to Edinburgh’s. It may not be on the same scale, but it is still serious."

In rural Scotland, the issue is not so much anti-social behaviour in buildings with shared entrances. Instead, STLs combine with other factors to create a housing shortage and inflated prices which drive young people out of already depopulated areas.

The Highlands and Islands in particular are affected by Londoners moving north. Flush with cash from the sale of their expensive city properties, these incomers are willing and able to pay over the odds, easily outbidding locals, for their dream home.

Others buy houses as second homes, spending a few weeks a year there. And there are also those individuals and companies snapping up accommodation to convert into STLs.

Whatever the eventual use, the result is the same: a dwindling number of properties for local people who have, in any case, been priced out of the market.

It is a complex issue many residents are reluctant to talk about. In the Highlands and Islands, as in Edinburgh, everyone recognises the importance of tourism to the economy. As far as second homes are concerned, they may prefer to see them let to holiday-makers who use the local shops and restaurants than lying empty. Furthermore, some of the STLs are owned by local people who are using them to supplement their own income.

At the same time, it is clear there are places in which the balance between residents and tourists is awry. Some restaurants and hotels are struggling to stay open because there is no affordable accommodation for seasonal workers.

Skye is at crisis point. There, a group of young people has been campaigning for radical action on housing through the community group Iomairt an Eilein.

“My family are from Skye and I hope to stay where I call home,” says Chisholm Campbell, who works for CalMac Ferries. "But many people I know will never see the day of purchasing their own home or returning to Skye because, even if buying a home isn’t in their interest, renting is nowhere near possible. Critical action is needed before we lose the culture and the people who live and breathe the place they call home.”

Further north, the situation is being exacerbated by the popularity of the North Coast 500.

Magnus Davidson, who lives in Thurso, says STLs are now springing up in areas which were not traditionally tourist spots. “Until recently, Caithness, and particularly Thurso, had escaped the pressure on housing that is endemic across the rest of the Highlands because of all the homes built for workers at Dounreay,” he says. “But things are starting to change. We are starting to see the telltale sign of keyboxes, and to hear of people who own three Airbnbs.

“I know of one couple who moved in together and, rather than one of them selling their home, they have kept it on as a short-term let. When my sister-in-law was selling her house earlier this year, she was offered more money from a lady from London who wanted to buy two houses in the street and turn them into STLs." She turned down the offer and sold it to someone local for less.

Davidson, who researches interactions between the environment, the economy and society at the University of the Highlands and Islands, says demand is so great, the STLs have spread from the more desirable properties close to the beach to former social housing and the Dounreay homes. “Post-covid we are seeing a huge increase in housing prices. You can’t get anything for the asking price, you need to go at least 10 % higher,” he says.

Ailsa Raeburn, chair of Community Land Scotland, concedes tourism is essential to the economy of many rural areas in Scotland. "But must be balanced against the need for communities to have enough good quality affordable housing for them to grow and thrive,” she says.

“The new licensing scheme would enable communities to have more control over the numbers of houses being lost to full time residential use, as well as weeding out those few bad owners who either don’t accord with health and safety or manage their properties to avoid neighbours being impacted by noise, or antisocial or criminal behaviour."

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Some people see STLs as a symptom rather than a cause. They believe they are a product of the financialisation of housing, where accommodation is treated as a commodity, a means of accruing wealth, rather than a social good.

Davidson says a wider conversation is needed about how second homes and STLs fit into a vision for rural Scotland. “The impact of removing a house [for a STL] is that people don’t live there,” he says. “You lose a family home. This affects the school roll, the sustainability of a village.

“We need to ask ourselves, as a nation, what are these houses for? Are they retirement homes or picturesque retreats for middle-class people who want to escape the city? Or are they the mainstay of thriving communities?”

In the meantime, grassroots organisations like PLACE and Community Land Scotland will continue to wage an unequal battle with Airbnb and other websites in the hopes of protecting their own communities.

They know that, while the Scottish government seems keen to act, there are potential hurdles to be overcome. Other authorities which have tried to impose crackdowns on STLs have faced legal challenge. Last year, the European Court of Justice found the City of Paris was justified in bringing in an authorisation scheme for STLs as a way to control its housing market and avoid a housing shortage.

“We are concerned about the potential uplevelling of action to prevent these licensing proposals from going through,” says Henderson. " I feel sorry for the Scottish government and local authorities who may have to spend money to fight Airbnb through the courts. I would rather that money was being spent directly on affordable housing, schools or health services, but this problem is not going away."

Raeburn, too, has her hopes pinned on the licensing proposals. “If they are passed by the Scottish Parliament, there will be future opportunities to think about how individual areas deal with them but, if they aren't, the free-for-all we have at the moment will just get worse and worse.”

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