The Scottish Government has now introduced the ‘Licensing of Short Term Lets’ Regulations, which came into effect in 2022. These regulations allow local authorities to introduce planning control areas throughout Scotland.
Short-term lets licence dates
If you, like us, operated a short-term let before 1 October 2022 you had to apply for the new licence before 1st April 2023. This date has now been pushed back to the end of September 2023. Owners will need to apply for planning permission – a ‘change of use’ from ‘residential’ to ‘short term commercial visitor accommodation’, before applying for the STL licence.
What the new regulations mean
The changes mean that STL property owners will need to comply with fire and safety requirements, similar to those in place in the private lettings sector already. The initial set up cost for planning, licence and safety requirement for a 2-bedroom property is likely to be circa £1,500 – £2,000. The licence needs to be renewed annually. Regional prices for the licence will vary, for example the licence cost of an Edinburgh, 2-bedroom property sleeping four adults will be £1,089, whereas in East Lothian the cost is £390 for all property sizes.
However, Edinburgh Council will exercise a ‘rebuttable presumption’ against the grant of a licence where the property is within a communal shared main door environment. In other words, flats in tenements and modern blocks will not be granted a short-term letting licence.
This means that there are likely to be circa 10,000 – 15,000 properties which will need to re-assess their next steps; options being to either convert back to long-term letting, or to sell. The lettings option may not stack up financially for everyone depending, on their goals.
If you’re an STL owner and not sure what to do next, we can provide information to help you in deciding. Selling, long-term rental or moving back in, may all be options for you.
Please contact us for a free, no-obligation chat about what solutions may be open to you.
Edinburgh House Price Values 2022-23
House prices in Edinburgh have continued to perform well across the city and local areas. During 2022, the average property sale attained 8.2% above the Home Report valuation.
The resilience of the city’s property market is quite remarkable where values in Edinburgh rose by 8.0% on average, albeit with some exceptional prices being paid in some quarters.
