New Rules for Short-Term Lets in England

The government is squeezing property investors again with changes to the rules for short-term lets.

Levelling Up Secretary Michael Gove has accused landlords of ‘hollowing out’ communities by stopping local people from living where they call home and failing to deal with anti-social behaviour by their tenants.

Under the reform, landlords must seek planning permission to let a home as a short-term let. The measure is a way for councils to control the number of short-term lets in their areas and to help local people find affordable housing.

Landlords must also register their short-term letting properties on a national database.

The government hopes the data will aid councils in assessing the number of short-term lets in their area; how they impact the community, and underpin health and safety compliance.

Holiday let havoc

Although landlords must apply for planning permission to run a short-term let business, a new rule allows homeowners to rent out their properties for 90 days in a year without agreement from the council.

The sweeping changes to owning short-term lets in England seem to be part of the government’s reforms of the rental market. The government will likely add them to a revised Renters (Reform) Bill currently navigating Parliament.

Ministers expect the new rules to come into effect in the summer.

Many of the changes proposed in the bill appease voters who rent a home and are seen by political experts as the Tories clearing the decks with vote sweeteners as the General Election approaches later this year.

Critics complain a flood of short-term lets in many holiday areas creates havoc in quiet neighbourhoods due to weekend party properties.

Locals shut out of the housing market

Property investors are switching from buy-to-let to holiday lets to cash in on higher profits and less restrictive tax rules that allow them to keep more of the money they make.

Launching the short-term let reforms, Levelling Up, Housing and Communities Secretary Michael Gove said: 

“Short-term lets can play an essential role in the UK’s flourishing tourism economy, providing great, easily accessible accommodation in some of the most beautiful parts of our country.

“But in some areas, too many local families and young people feel they are being shut out of the housing market and denied the opportunity to rent or buy in their community.

“So, the government is taking action as part of its long-term housing plan. That means delivering more suitable homes in the right places and giving communities the power to decide.

“This will allow local communities to take back control and strike the right balance between protecting the visitor economy and ensuring local people get the homes they need.”

The reform involves creating a new planning use class for short-term lets that are not a primary home. Existing short-term lets will automatically change class and will not need planning permission.

New permitted development rights will be introduced at the same time. One will allow owners to restore a property from use as a short-term let to a primary home; the other will allow homes to switch to short-term letting.  Councils may remove the rights in favour of planning permission.

Hotels, bed-and-breakfast accommodation or hostels are unaffected by these rule changes.

New rules for home improvements

Meanwhile, the government has opened a consultation on reforming permitted development rights to allow homeowners in England to make their homes larger, alter or extend the roof, and construct buildings incidental to a main house, such as bin and bike stores.

Permitted development rights allow homeowners to improve their homes without applying for planning permission, which would be too expensive compared with the impact of the works.

The consultation also asks for views about electric vehicle charging infrastructure, which includes amending the right to install wall-mounted and upstand electrical outlets within two metres of a road and installing larger upstands.

The government also wants to know what homeowners think about the right to install air-source heat pumps.

The consultation will close on April 9.