Tag: short-term lets

Edinburgh council facing £1 million compensation payouts over unlawful planning fees in ‘shambolic’ short-term let licensing rollout

More than a hundred self-catering operators have lodged formal complaints of maladministration against City of Edinburgh Council, citing unlawful charges amounting to thousands of pounds in unnecessary planning fees.

These fees were imposed during the rollout of the Council’s controversial short-term let (STL) licensing scheme under the leadership of former Council Leader, Cammy Day.

A recent Judicial Review at the Court of Session confirmed that self-catering businesses operating before 5th September 2022 were not required to apply for planning permission or a certificate of lawfulness. However, in 2024, operators were compelled to incur these costs, which could now lead to financial repercussions for the Council exceeding £300,000.

With additional complainants expected, the total compensation owed could surpass £1 million in unlawfully levied fees.

This development follows multiple legal challenges by self-catering operators against the Council’s STL licensing policies. Edinburgh Council has already been forced to amend its policies twice following rulings against it in the Court of Session.

A third legal threat recently prompted the Council to concede once again that its policy was unlawful.

Ralph Averbuch, spokesperson for Justice for Scotland’s Self-Caterers, commented: “Edinburgh Council’s recent actions have caused immense distress and in some cases loss of employment to self-catering operators that had historically been advised no action was required other than moving from council tax rolls to non-domestic rates.

“Now that we have a new regime in place, it has never justified the retrospective hounding of those that traded prior to the introduction of STL Licensing and the opportunities the Council took to use this as a pretext for closing down a sector that accounts for well under 1% of all homes in the capital.

“To be clear, this city needs self-catering to function and the Council’s lack of recognition of the wider impacts has already done great harm, adding cost to operators and visitors alike.”

Fiona Campbell, CEO of the Association of Scotland’s Self-Caterers (ASSC), added: “It is deeply regrettable that the self-catering community must yet again challenge Edinburgh Council’s STL policies which amount to an ideologically driven de facto ban.

“Despite being a professional and integral part of Edinburgh’s tourism economy, legitimate businesses continue to face an existential threat. The mishandling of STL regulations by the Scottish Government was evident from the outset. We continuously warned that they were not fit for purpose and now we are seeing the consequences unfold.

“With the shambolic roll out of licensing across the country, it is only a matter of time before further compensation claims emerge throughout Scotland.”

The city council has yet to comment on this latest development.

Councillors agree changes to Edinburgh’s short term lets licensing policy

ASSC: ‘Part-time approach to health and safety’

Councillors on the Regulatory Committee met on Friday 31 January and agreed some changes to the Council’s licensing policy on short term lets (STLs).

This follows a 12-week consultation held over the summer when residents and industry were encouraged to share their experiences of the policy in the Capital so far.   Topics included were secondary letting, temporary exemptions, fees and the application process.

Targeted discussions with resident groups, industry bodies and other key stakeholders led to 780 responses being submitted.  This led to the Council recommending some changes to policy in these areas which reflected feedback, legislation and fees.

A further report will be considered in May 2025 that proposes extending secondary letting licence renewals from one year to three years.

Regulatory Convener, Councillor Neil Ross, said: “The Council’s short term lets licensing policy is helping to ensure holiday lets are safe and properly regulated in our city as over 4,400 applications have been granted since it was first introduced in October 2022.

“I welcome the changes to reduce licence fees for residents looking to Home Share and to make temporary exemptions for Home Sharing and Home Letting less onerous, while at the same time providing robust regulation of the short term let industry. I’d like to thank all of the residents and businesses across Edinburgh who took the time to tell us how the scheme is working for them.”

ASSC warn over “part-time approach” to STL health and safety

The main trade association for the Scottish self-catering industry responds to the policy changes agreed by City of Edinburgh Council’s Regulatory Committee last week:

Edinburgh Council will water down key health and safety requirements for homesharers during the Festival period to try to ease the acute shortages of visitor accommodation. Those renting out a spare room, or their entire main home, could gain a temporary exemption which would exclude them from tests and requirements in relation to gas, electrical and fire safety, as well as on legionella.

However, professional operators like self-caterers and B&Bs will still have to comply with the mandatory conditions associated with short-term let licensing.

The Association of Scotland’s Self-Caterers (ASSC) believes the changes are a recognition from the Council that the regulations are not working and would continue to jeopardise the Festivals in their current form. However, they criticised the “part-time approach” to health and safety which undermines the entire purpose of STL licensing set out in the Scottish Government’s legislation, and risks further incentivising the black market.

The ASSC argues that a level playing field for all types of STL accommodation is required all year round and that the Festival accommodation crisis could be eased through safe and lawful means, including reforms to the city’s draconian planning regime to allow the remaining self-catering properties to continue to trade.

Fiona Campbell, CEO of the ASSC, said: “This change is an admission that the short-term let regulations are harming the capital’s economy and threatening the viability of the Festivals. However, rather than fully resolving the issue, it simply undermines the entire purpose of the Scottish Government’s short-term let licensing regime.

“Ensuring the health and safety of guests is a 365-day operation which self-caterers are wholly committed to. However, a part-time approach is irresponsible and will simply be a boon for the black market which is already flourishing thanks to the squeeze in the supply resulting from the shambolic short-term lets policy.

“Legislation at a national level remains unfit for purpose, especially the conflation of short-term let planning and licensing systems. We now have a situation where responsible and professional operators have spent thousands complying with licensing but are being systematically shut down through onerous planning requirements – only for the door to be opened to unregulated and potentially unsafe accommodation.

“Councillors need to ask themselves: will Edinburgh’s position as a leading visitor destination be enhanced by allowing visitors from around the world to stay potentially unsafe accommodation? Do properties suddenly become safe during the month of August but then dangerous the remaining eleven months of the year?

“Small businesses like self-catering have helped provide accommodation for Festival goers and performers for decades. Our industry wants them to succeed but we need safe, reliable and quality accommodation for that. Edinburgh Council must look at other ways of addressing this crisis and the sector stands ready to work with them to this end.”

‘Bombshell’ report shows short-term lets boost Scottish economy by £864m per year – with no evidence of housing impact

BiGGAR Economics challenges ‘false narratives’ surrounding Scotland’s self-catering sector now at risk from heavy-handed government regulation

NEW independent analysis from a respected Scottish consultancy reveals the substantial positive economic impact of Scotland’s self-catering industry which was also shown to have a negligible effect on housing.

BiGGAR Economics calculated that short-term lets (STLs) contribute nearly £1bn gross value added (GVA) to the Scottish economy while supporting approximately 30,000 jobs. By accommodating visitors, STLs generate economic activity across Scotland, with the local impacts exceeding residential use, supporting an additional £32,400 GVA per property.

Guests staying in self-catering accommodation, termed ‘secondary lets’ in Scottish STL legislation, also spend more than the average visitor to Scotland, with knock-on gains for related tourist and hospitality businesses. Alongside this huge economic boost, the researchers also highlight that self-catering accounts for less than 1% of the country’s total housing stock.

This challenges the narrative that STLs are fuelling Scotland’s housing crisis, with self-catering at only 0.8% of the country’s housing stock, too low a proportion to have a meaningful impact on local housing markets. Moreover, according to the report, in every local authority area, economically inactive empty homes account for a larger proportion of total dwellings than from secondary lets.

The key headlines include:

  • STLs are estimated to generate £864m GVA and support 29,324 jobs across Scotland;
  • Edinburgh and Highland together account for 44% of the total economic impact but the sector’s benefits are dispersed throughout Scotland;
  • The annual GVA associated with an average owner-occupier/private rented household in Scotland was £14,451, compared to £50,159 for a two-bedroom STL; and
  • STLs make up a tiny proportion of Scotland’s housing stock, with self-catering accounting for just 0.8%. This is considerably less than the 3.6% that economically inactive empty properties account for.

This study comes as the Scottish Government published an implementation update report on STL licensing which the industry maintains did not adequately address their longstanding concerns. At a local level, councils such as Highland and Edinburgh are also assessing their regulations.

BiGGAR’s new analysis is based on the best available evidence on STLs in Scotland. The findings have been shared with Scottish Government Ministers and officials.

Graeme Blackett, Director of BiGGAR Economics, said: “This report shows that secondary lets make an important contribution to Scottish tourism and economy overall, supporting almost 30,000 Scottish jobs.

“Our research also concluded that it was clear that secondary lets are not a driver of the wider Scottish housing market.

“If short-term let regulations leads to a reduction in the supply of secondary lets, that will have a negative impact on the tourism economy, without delivering any solutions to Scotland’s wider housing challenges.”   

Fiona Campbell, CEO of the Association of Scotland’s Self-Caterers, said: “This is yet more compelling evidence that short-term lets aren’t the main contributor of the housing crisis but are instead turbocharging local economies with a near £1bn positive impact while supporting 30,000 jobs.

“The current unbalanced regulatory framework does not reflect this reality and changes are needed before irreversible damage is done.

“Local councils should take heed of the report’s findings when considering their approach to planning policies and control areas to ensure the relatively small number of valuable short-term lets are protected.

“For policymakers, the message couldn’t be clearer: you can’t solve a housing crisis by producing a crisis in Scottish tourism by decimating local businesses that underpin local economies. Attention must shift to the real causes of the housing crisis.”

Economic-Impact-of-Short-term-Lets-in-Scotland-Report-by-BiGGAR-Economics-11Dec24Download

Updates to short-term lets licensing scheme approved

Technical changes passed by Parliament

MSPs have backed a range of technical updates to the short-term lets licensing scheme in response to engagement with accommodation operators.

Licensing was introduced in 2022 to provide assurance to guests on safety and quality, such as gas and electrical safety compliance and the suitability of hosts.

The regulations passed by the Scottish Parliament enable:

  • Licences to be transferred to a new host, such as when accommodation is sold
  • Prospective hosts building a new short-term let to apply for a provisional licence before construction is complete
  • Hosts to apply for a maximum of three licence exemptions totalling six weeks in a calendar year

Minister for Housing Paul McLennan said: “Short-term let accommodation is vital to Scotland’s tourism sector and wider economy.

“The short-term lets licensing scheme aims to protect the reputation of responsible operators and ensure the sector is regulated in line with other accommodation such as hotels and caravan parks, giving guests assurance of consistent safety standards. The technical updates to the scheme passed by Parliament were introduced in response to engagement with short-term let operators and the wider tourism industry.

“This will ensure the scheme continues to deliver quality and safety assurance for guests, whilst protecting the needs of local communities.”

CEO of the UK Short Term Accommodation Association Andy Fenner said: “Scotland’s holiday let industry brings in revenue for all kinds of businesses in communities not served by traditional hospitality, and makes the country an attractive destination for the millions of overseas visitors that come every year.

“Improvements, such as the ability to transfer licences and greater flexibility around temporary exemptions should assist in providing more certainty to those who rely on income from tourism.

“We have been working with the Scottish Government on these changes over the past year and appreciate its collaborative and pragmatic approach to addressing feedback.

“We are encouraged by the Government’s commitment to addressing other issues related to the scheme and look forward to working together on identifying further improvements which will boost the competitiveness of our sector in Scotland.”

Edinburgh short-term lets regulations ruled unlawful

The City of Edinburgh Council’s licensing scheme for short-term lets operators has been deemed unlawful at the Court of Session.

Rosie Walker, partner and head of litigation at Gilson Gray, who represented the short-term let operators who brought the action, said: “The court found that the City of Edinburgh Council’s short-term let licensing policy was unlawful at common law and in breach of The Provision of Services Regulations 2009 for a number of different reasons.

“Most strikingly they found that it was not for the council, as licencing authority, to decide that a licence should not be granted just because a property is in a tenement.

“Our clients took the brave decision to bring this action against the local authority to protect their businesses and, more widely, to protect an industry that is very important to the Edinburgh economy.

“Short-term accommodation providers create a significant number of jobs in the city and deliver flexible accommodation that hotels and other operators simply cannot – particularly during important events like the Edinburgh Festival.

“The campaign was the largest crowdfunded legal case in Scottish history, underlining the strength of support for our clients. It comes on the back of years of engagement by the Industry with the Scottish Government and the local authority to try to put in place a workable regulatory framework.”

The court’s decision is a significant setback for the city council. Council leader Cllr Cammy Day said: “I’ve received today’s judgement and am pleased that we’ve been successful in defending large parts of our policy.

“While I’m obviously disappointed that the court didn’t find in favour of our policy on secondary lets, I make absolutely no apology for seeking to protect our residents.

“It’s no secret that we face unique housing pressures here in Edinburgh, with a small but densely populated city centre and fast growing population, and it’s crucial for us to strike the right balance between promoting our visitor economy while looking after the people that live here all year round.  

“Our residents have told us that, in many cases, STLs are hollowing out their communities, reducing housing supply and increasing housing costs. We can’t forget that many have endured years of disturbance and anti-social behaviour and we will continue to work hard to get this right.

“The court acknowledged our intention to find a solution to this and agreed that it was legitimate to use both planning and licensing policy. We welcome the clarity provided and will now consider our next steps in more detail.

“We remain committed to ensuring the whole city benefits from our thriving visitor economy but it has to be managed and it has to be sustainable – and I continue to believe that fair and effective STL controls would be an important step in the right direction.”

New licensing scheme opens for short-term lets

Measures to establish consistent standards across the country

A new licensing scheme for short-term let hosts opened yesterday, aiming to ensure consistent safety standards while reinforcing the positive reputation of Scottish tourism and hospitality.

The licensing scheme was developed in response to concerns raised by residents about the impact of short-term let properties on their local communities. It gives councils flexibility to develop licensing schemes that meet local needs, and sits alongside powers for councils to establish short-term let control areas.

To comply with the licence, hosts will be required to meet a set of mandatory conditions which apply across Scotland, plus any additional conditions set by their council.

Anyone operating as a host before 1 October has until 1 April 2023 to apply for a licence and can operate until their application has been determined. New hosts must obtain a licence before accepting bookings and welcoming guests to stay.

A targeted digital marketing campaign to promote the licensing scheme also launches today.

Housing Secretary Shona Robison said: “Our new licensing scheme will support responsible operators and give guests the confidence that their short-term let – be it a flat in Edinburgh, a property for a business trip to the Borders, or a cottage in the Highlands – meets the same set of safety standards.

“These new conditions include measures such as displaying an energy performance rating on listings, or securing valid buildings and public liability insurance. We know the vast majority of short-term lets businesses are already following these safety standards as a matter of best practice, and some are already required by existing legislation.

“We know short-term lets make a positive contribution to Scotland’s tourism industry and local economies, and these measures will allow them to continue doing just that while ensuring this is balanced with the needs of local residents and communities.

“The deadline for applications from existing hosts is 1 April, and I would urge all hosts and operators to contact your local authority as early as possible to learn how to apply.”

Malcolm Roughead, CEO at VisitScotland, said: “The small accommodation sector is a key contributor to the economy and our high-quality and varied offering is one of the things that makes Scotland such a special destination.

“Through an Industry Advisory Group, we’ve been working closely with representatives from across the sector ahead of introduction of the licensing schemes.

“We’ll continue to give both new and established businesses the right advice to help them through the process of applying for a short-term let licence.”

More information about the new licensing requirements and short-term let control areas can be found on the Scottish Government website.

Cockburn Association: Manifesto for the City

As we head into the Local Council elections in May, the Cockburn Association has set out its “asks” of current and prospective councillors.

In doing so, we also set out key areas for policy and management to carry Edinburgh  forward post-Covid during the next administration between 2022-27.

Read and download our full manifesto by clicking here, then get in touch with the candidates in your ward and ask them if they will commit to the following:

The next five years will need to be about building a new, resilient future for the City.  Maintaining the quality of our streets, buildings and neighbourhoods should be at the forefront of governance priorities.

Professor Cliff Hague OBE, Chairperson of the Council of the Association commented: “We need to move from an exploitive linear economy to one that cherishes and reuses its built and natural environment and places community well-being at the heart of decision-making.”

The Cockburn discussed some of the ideas in this latest Manifesto for the City in greater detail in our recent publications Our Unique City (2019) and the revised version, Our Unique City: our future after coronavirus (2020).

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‘Team Edinburgh SNP’ calls for strong action on short term lets

Edinburgh’s SNP MPs, MSPs and Councillors have jointly written to Kevin Stewart MSP, Scottish Government Minister for Local Government, Housing and Planning, calling for new initiatives to tackle problematic short-term letting in the capital. Continue reading ‘Team Edinburgh SNP’ calls for strong action on short term lets

Short-term Lets: wide support for regulation

A consultation on short-term lets has found wide support for regulation, according to independent analysis published yesterday.

More than 1,000 responses from communities, landlords and businesses raised a number of concerns about the effects of short-term lets, including anti-social behaviour, safety fears and the impact on the housing market. Continue reading Short-term Lets: wide support for regulation