Edinburgh’s festivals: Self-catering tourism chief warns of hotel price hike due to exodus of short-term let operators

Hotels predicted to hike up prices as demand outstrips supply of rooms

Fiona Campbell is chief executive of the Association of Scotland’s Self-Caterers.

The figurehead of Scotland’s self-catering accommodation sector has suggested hotel operators will be deliberately hiking up their prices during Edinburgh’s peak summer festival season to cash in on a surge in demand due to the impact of new restrictions on short-term letting in the capital.

Fiona Campbell, chief executive of the Association of Scotland's Self-Caterers, said hotel operators were already "rubbing their hands" at the prospect of capitalising on new curbs on landlords who have previously let out rooms and flats to festival workers.

Festival chiefs have previously raised concerns that a lack of flexibility over short-term letting during major events posed a threat to the long-standing tradition of residents putting up performers and crew in their homes.

Fiona Campbell is chief executive of the Association of Scottish Self-Caterers.

Ms Campell accused the Scottish Government and city council of making it "reprehensibly difficult" for a self-catering business to secure any kind of licence and suggested only a handful were being given the green light.

She claimed many operators in Edinburgh were already deciding to pull out of the sector and instead only use second homes for friends and family as the regulations which had been rolled out were "pretty much the most draconian in the world."

Ms Campbell suggested Edinburgh faces being left with an event "for the rich only" as the supply of suitable accommodation for festival performers and staff would not be able to meet demand.

The city council said it was currently handling around 3600 applications for a short-term letting licence in the city and had not turned down any so far.

Keylocks are a familiar sight across Edinburgh, but that could now change on the back of tighter short-term lets regulations

Ms Campbell was speaking on the Constable Confidential podcast before short-term let operators in the city secured a second legal victory over the city council’s crackdown on the sector.

They had argued that retrospective planning permission should not be needed for properties which were operating before a new city-wide “control area” was introduced in September 2022.

Ms Cambell said: "There is a narrative that somehow this is all going to be the magic bullet to solve the housing crisis.

“The vast majority or a significant amount of self-catering operators in Edinburgh are people who are using their second home legitimately when they are not there.“They are not going to sell it because that is their Scottish home. They’re not going to rent it out long-term term because they’re not going to be able to get rid of your tenant. They’re just going to lie empty. It’s absolutely bonkers.

"It’s not rocket science. If you reduce the supply, but the demand is still there, what happens? The prices go up. The hotel industry is rubbing its hands in glee thinking: ‘Excellent.’

“You’ve got to remember that the Edinburgh Festival started off with people renting out their own rooms and houses.

“However it has been made reprehensibly difficult and expensive to get a licence for that. The regulations are pretty much the most draconian in the world.

“It costs around £3500 to go through the licensing process for a smallish apartment.”

Ms Campbell was speaking after German comic Henning Wehn, a long-time Fringe performer, suggested he was finished with the festival after struggling to find suitable accommodation cheaper than £9000 for the month.

She told the podcast: "The Edinburgh Festival will continue, but I cannot help thinking that the unintended consequences of all of this will mean it will change irrevocably.You have got senior figures from the festival who come year on year who are simply saying they are just not going to do it.

“They are saying that it’s going to be a festival for the rich only because nobody else is going to be able to afford to go.

"This isn’t just about the performers. It's also about the people behind the performers who are putting on all these amazing shows. “Policies have been created in silos. As a result, we’ve ended up with unintended consequences that hurt people, communities and economies.”

Council planning convener James Dalgleish said: “We have to strike the right balance between promoting our visitor economy while looking after our residents who live here all year round and, having just announced a housing emergency, it’s more important than ever that we find ways of bringing homes back into residential use.”