What Regulation is in Store for Holiday Lets in England? 

Recent years have seen a surge in the holiday lettings sector with the popularity of digital platforms like Air BnB.  It has brought benefits in increased income for individuals and local economies but has raised challenges for others with anti-social behaviour and availability and affordability of homes for residents.  Whether this type of accommodation is a benefit relied on for tourism or a challenge faced by residents differs widely across the country.   

Areas like Blackpool have regenerated in recent years but aside from its many BnBs, it relies on holiday lets to boost the local economy.  Any heavy handed one size fits all regulation could deter landlords from investing.  Specifically, stag and hen parties use this type of accommodation to enable them to stay together as they are generally not welcome in traditional BnBs.   

Other areas like St Ives in Cornwall appear to require some regulation to help residents who are pushed out by high prices and availability.  

A high concentration of holiday lets can result in areas becoming ghost towns out of season and affecting local services through the lack of a permanent population.  

The issues surrounding holiday lets are often seen as coastal town issues.  However, the popularity of digital platforms and staycations due to the covid pandemic has meant this type of accommodation is being seen across the country, nestled in quiet residential areas attracting visitors who are less concerned for the surrounding neighbours than they would be at home.  

Current Position: Do you need planning consent to use your property as a holiday let?

You need planning permission to make a permanent material change from use class C3 dwellinghouse (aka your own home) to a holiday let.  The point at which a property changes from C3 to a holiday let is not always straight forward and has been the subject of numerous appeals.  The government is proposing changes to try and provide clarity.  

What are the proposed changes landlords need to be aware of?

In 2022 the Government launched a call for evidence to gather information on the benefits and challenges that holiday lets pose in England and how the Government should tackle this growing area of guest accommodation. 

As a result, the Government has consulted (in relation to England only) on proposals for registration schemes and on a new use class. The proposed changes have potential to introduce clarity for Landlords and Local Planning Authorities which will be welcome.  

What is being considered?

The introduction of a new use class ‘C5’ specifically for holiday lets.  The following definition for use class C5 has been proposed:

“Use of a dwelling house that is not a sole or main residence for temporary sleeping accommodation for the purpose of holiday, leisure, recreation, business or other travel.”

The consultation envisages that the existing C3 use will allow a property to be let for a period of between 30 and 90 days (yet to be determined).  Whether the use of a property tips over into the new C5 definition is still something to be assessed as matter of fact and degree however, the introduction of the new definition and the mention of specific periods is likely to frame and assist in assessing what is a material change of use.  

The introduction of a new permitted development right to enable a change of use from a dwellinghouse to a C5 holiday let and vice versa without planning permission.  

The new permitted development right will give local authorities flexibility to assess how the holiday let sector is affecting their community and respond if necessary.   In areas where there are issues, a local authority may remove the permitted development right by an Article 4 Direction requiring any such change of use to apply for planning permission.  

In areas with no issues caused by holiday lets, landlords can let their property without planning permission.   

Gwyneed Council in Wales has become the first Council to introduce planning restrictions relating to holiday lets by way of an Article 4 Direction.  In addition to responses to the consultations, will the results of Gwyneed Council’s actions set a precedent and inform government proposals?  

Whilst the proposed changes do not require you to, if you are unsure whether your property falls within use class C3 or C5, you can seek clarification by way of a Lawful Development Certificate. If granted, it will evidence the lawful use of the property as stated in the certificate.     

Registration Schemes 

Alongside the planning changes, the Government is proposing a registration scheme.  The main purpose of such a scheme is to collect data on short-term/holiday lets and, to provide local authorities with more detail on which properties are let.  This allows them to manage the potential impact of high numbers of this type for accommodation and enforce use class changes (should that be introduced). 

The registration scheme would aim to tackle concerns around affordability and availability for locals (particularly in areas of highly concentrated short-term/holiday lets) and anti-social behaviour.  It would also help to drive standards and ensure all landlords are providing the public with safe and quality assured guest accommodation. 

What might the registration scheme look like? 

The consultation sets out three potential approaches for the type of scheme which the Government may bring into effect. In summary they are: 

- Opt-in Scheme for Local Authorities: local authorities would choose whether to join the scheme based on the needs and challenges of their area. The risk with this approach is it would not guarantee a consistent approach across England. 

- Opt-in Scheme for Local Authorities with a review point to determine whether to expand the scheme to mandatory: The difference with the approach above is that following an evaluation period the scheme could be made mandatory if needed. This approach allows more flexibility as it allows time for the Government to see how the scheme is utilised. 

- Mandatory National Scheme to be administered by either the English Tourist Board (VisitEngland), local authorities or another competent authority. This approach addresses a need for consistency and the application of existing health and safety regulations across all short-term/holiday lets. It would provide all local authorities with the data needed to monitor which premises are short-term lets and tackle any potential impacts they may cause locally. 

Will the changes be helpful or a hinderance? 

There is no need to rush to take any action at present.  Whether the changes will be helpful or a hindrance will depend on how they are introduced in particular; 

- What criteria, conditions and limitations the permitted development right will be subject to; and

- How widespread any Article 4 Directions to remove the permitted development rights will be. 

The proposed changes are attempting to provide clarity.  They also appear to be providing flexibility allowing local authorities to deal with the different issues that are seen across the country.  

The main thing to do right now is to keep up to date with the changes and stay aware of what you may need to do in the future. 

* Rebecca Mushing is a specialist planning lawyer at Wright Hassall *

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