- 21 Jan 2020
Following careful consideration of consultation responses and the evidence provided by independent research, the Scottish Government will:
- introduce licencing for short-term lets, under the Civil Government (Scotland) Act 1982, with a mandatory safety component which will apply to all short-term lets across Scotland. Local authorities will also be given the discretion to put in place further conditions.
- prioritise work to give local authorities the power to introduce short-term let control areas under powers in the Planning (Scotland) Act 2019.
- undertake a review of the tax treatment of short-term lets, to ensure they make an appropriate contribution to the communities they operate in.
Regulations giving local authorities the powers to license short-term lets and introduce control areas will be in place by spring 2021.
Short-term lets have become the subject of controversy in parts of Scotland and evoke strong opinions. For many, short-term lets using Airbnb and similar platforms have enabled cheaper, more flexible travel, but others – particularly in tourist hotspots, like the centre of Edinburgh, and Skye – are concerned they make it harder to find homes to live in.
The Scottish Government set up the Expert Panel on the Collaborative Economy in April 2017 to provide advice, expertise and experience for policy development and identify how Scotland could maximise the benefits of the collaborative economy, ensure that regulation is fit for purpose and that the wider economic, social and community impacts, including taxation, social inclusion and employment conditions are taken into account.
The panel reported that peer-to-peer accommodation expands the range, choice and flexibility of accommodation for tourists in Scotland and we welcome the positive contribution which it can make to Scotland's economy. However, the panel also highlighted a number of issues and challenges in relation to peer-to-peer accommodation, and short-term lets more broadly. The Scottish Government’s to the panel’s report was published on 10 July 2018, and committed us to a range of actions, including establishing a Short-Term Lets Delivery Group.
Short-Term Lets Delivery Group
The Short-Term Lets Delivery Group was established to assess the evidence base and the impact, positive and negative, of short-term lets; identify the existing powers local authorities have and explore whether further measures are required. The Group comprises officials from across relevant areas of government including: better regulation, community empowerment, economy, housing, licensing, planning, tax and tourism.
Consultation and independent research
Our 2018-2019 Programme for Government made a commitment to ensure that local authorities have appropriate regulatory powers to balance the needs and concerns of their communities with wider economic and tourism interests.
The First Minister launched a consultation on a regulatory framework for short-term lets in Scotland in April 2019 which sought views on what those powers should be. The consultation paper was supplemented by a research annex, ‘The Short-Term Rental Sector, Housing and Tourism in Scotland’, providing an overview of the available evidence on short-term lets in Scotland and regulations introduced elsewhere in the world.
The consultation closed on 23 July 2019, receiving over 1,000 responses and finding wide-ranging support for some form of regulation, appropriate to local circumstances. Responses highlighted a number of concerns about the effects of short-term lets, including safety, anti-social behaviour, and impact on the housing market. However, the economic benefit to communities was also highlighted for example by providing business for small enterprises such as pubs, restaurants, cafes and grocery shops. Responses to the consultation (where consent has been given to publish), together with an independent analysis of the consultation responses were published on 28 October 2019. Further details can be found in the news release.
In addition, we published independent research on the impact of short-term lets on communities. This research was commissioned to explore the positive and negative impacts of short-term lets on communities, with a focus on neighbourhoods and housing. It involved short-term let hosts, residents, local businesses and community actors across five locations in Scotland.
The research highlighted a number of positive impacts of short-term lets on communities, including local economic benefits associated with tourism and increased household income for hosts. However, the research also confirmed that negative impacts on communities’ quality of life, reduced availability of residential housing and increased strain on local public services were among the key negative impacts.