Short-term lets: It's time to dial down the rhetoric

You can see them, phone in hand, quizzically looking around some residential neighbourhood in Edinburgh for the Airbnb they have booked online. It was a constituent who encapsulated the change for me – “cheap flights, Airbnb and wheelie suitcases” he argued were behind the boom in Edinburgh’s short-term lets.

Booking a flight and accommodation to the destination of your choice on your phone is part of the disruption that the tech revolution has delivered. It’s opened up the world to many people, but it’s also caused mayhem in popular tourism destinations such as Amsterdam, Berlin, New York and now Edinburgh and other parts of Scotland.

In November 2017, I launched a campaign called Homes First. It was designed to highlight the unregulated nature of much of the short-term letting that was going on in Edinburgh. Stories of the misery this caused residents came flooding in.

One girl was sitting her Higher English the following day but a short-term let above her was rented out to sports fans who were up until late partying. She had a bad sleep, failed her exam, and lost her place at university. Others have to move out of flats with common stairs over-run with short-term lets.

Very quickly, I and others came to the view that what was needed was clarity and enforcement within the planning system together with effective registration and/or licensing for operators.
Planning law was eventually tweaked, and a licensing scheme was proposed. Its first iteration was withdrawn by the then minister, Kevin Stewart, in 2021 but it was later re-introduced by his successor, Shona Robison, with some changes and passed by parliament in January 2022. The LibDems, Labour and Conservatives all voted against it.

This division sowed the seeds for the current bitter war of words between the self-catering industry and those who support the new regulations. With a 1 October deadline looming to apply for a licence, the acrimony is only likely to grow. With a six-month extension already having been granted, ministers are in no mood to capitulate to a campaign that has come across as strident and confrontational, with a number of legal actions being launched to challenge the new law. 

But like many public policy issues and wider political debate, the language and postures of those opposed and those in support have almost exclusively been siren, contemptuous and dismissive. As someone who campaigned hard for these changes (but voted against both the planning and licensing regulations due to their over-reach) I welcome the new rules but understand that there are some genuine problems.

Ministers and those affected urgently need to dial down the rhetoric and address a number of practical issues.

Some issues were simply not discussed at all in parliament. This was far-reaching secondary legislation and there was some scrutiny by committee but no opportunity to amend the regulations.

Now, in response to the requirement to have a licence, the industry is up in arms. “A pogrom”, argued one demonstrator outside the Scottish Parliament. You could always try camping, said John Mason MSP, helpfully, in response to claims of the mass extinction of Scotland’s self-catering sector. With 42 per cent of tourists staying in self-catering, B&Bs and guest houses and only six per cent camping, according to the latest VisitScotland survey, maybe not.

What to make of the current stooshie?

Some MSPs are clearly weaponising this issue for political gain. Plus ça change. Many in the short-term letting sector are also making strident and unevidenced claims about potential costs and impacts. But there are issues at the heart of this debate that will, someday, need to be addressed.

Yes, there will be a reduction in short-term lets, particularly in Edinburgh, where so many are operating unlawful businesses. Research I conducted in 2020 showed that of the 1,609 short-term lets entered on the Valuation Roll for non-domestic rates in Edinburgh, a mere six had planning consent to operate. To the extent that much of Edinburgh’s tourism accommodation is going to disappear, this is an issue, albeit one that should never have been allowed to arise in the first place.

The decision to sweep up bed and breakfast into the licensing scheme remains founded on poor logic. There was never any evidence that B&Bs pose any particular problem but because home-sharers typically using Airbnb might decide to offer a simple breakfast to guests if B&Bs were excluded (and thus avoid regulation), it was decided that B&Bs had to be included. In other words, a sector that has never been cause for concern would be forced to apply for a licence because another group might seek to impersonate them.

Unintended consequences are inevitable. Home swapping is caught by the regulations (apparently intentionally) but other activities such as house sitting will need a licence where they are used “in the course of business”, a term that is undefined in law but which guidance suggests could mean a simple written agreement – something which is good practice for house swappers and house-sitters. These activities were never debated by MSPs or parliament.

Whatever one might think of the licensing regime, it has been the subject of pretty extensive development and is now the law of the land. Ministers and those affected urgently need to dial down the rhetoric and address a number of practical issues. Meanwhile, those who now need licences would be wise to crack on and get their applications in by the deadline otherwise they will be committing a criminal offence if they continue to trade.