The number of short-term lettings has increased in recent years, particularly due to the growth and development of online platforms such as Airbnb and which help to connect people looking to rent out their properties with others seeking short-term accommodation.

These platforms help to provide a stress free, and flexible option of generating income, and has made short-term lettings an attractive prospect for some. If you are considering letting out your property on a short-term basis, the following are some matters that should be considered:

  1. Have you got permission?

If your property has a mortgage (or any form of loan), you should check the terms of your agreement and/or talk with your lender to ensure there are no restrictions on you hosting your property. It is likely that you will need to get your lender’s permission/consent beforehand: Failing to obtain this could mean that you are breaching the terms of your mortgage.

If you do not own the freehold property but are instead renting from a landlord yourself, you must check the terms of your tenancy agreement to see whether you can legally sub-let the property on a short-term basis on platforms like Airbnb. The vast majority of tenancy agreements are likely to state that the property in question may only be used as a ‘private residence’ or ‘private dwellinghouse’ or that it cannot be used ‘for any trade or business.’ This would prevent you from renting out your flat or home for short periods. Breaching the terms of your tenancy agreement by nevertheless entering into an Airbnb type arrangement may leave you vulnerable to legal action or the loss of your own tenancy.

  1. Insurance

Standard house insurance policies only cover your house and its contents and will not normally provide cover for damage or loss of property caused by a guest who books your accommodation or if they are injured whilst staying at your property. Some online platforms offer insurance as part of their service but these may not cover all your insurance needs. You may consider it necessary to obtain specialist insurance advice and obtain cover against accidental damage, liability insurance, and possible loss of income (if e.g. an insured event makes your property unavailable for a while).

  1. Compliance with Laws

You must comply with all national and local health and safety regulations. You must ensure your guests are protected from any hazards/dangers in your property and must comply with all fire, gas and electricity, and structural safety requirements.

You should check with your local planning authority to make sure that you are allowed to host short-term rentals in your area. Currently, those wishing to short-term let their properties in London for more than 90 nights a year must seek planning permission.

You may also be liable for business rates if you short-term let your property in England, Scotland, or Wales for 140 days or more per year if the government deems this a self-catering property.

  1. Complaints

Aside from your guests/tenants leaving you a bad review online following their stay, your neighbours may also be unhappy with your short-term letting activity which could leave you open to claims/complaints being brought against you following noise disturbance, anti-social behaviour or inappropriate disposal of food waste and general refuse etc by your guests, which is something to bear in mind.

For further advice relating to leases (including short-term lettings) or any disputes that arise with your tenants, contact a member of our commercial property team today on 0845 287 0939 or get in touch with us through our website.