With the holiday season fast approaching, hosts of short-term let hosts should make sure that they are well informed and fully equipped to operate their premises legally.
Although short-term letting is not a new concept, it has attracted more attention in recent years due the increase in second homes used for holiday accommodation and the emergence of online platforms which allow self-management of properties on a casual basis.
Although guests are more vulnerable in short-term lets than in longer term accommodation because they are less familiar with the property, prior to these changes, the safety requirements for short-term lets were less onerous than those for long-term lets or for hotels. The regulations attempt to redress that imbalance. However, it's important that hosts understand their increased responsibilities and take care not to breach the new requirements.
What is a short term let?
"Short Term Let" is defined as the "provision of residential accommodation by a host to a guest in the course of business and for commercial consideration." The premises must not be the primary home of the guest and the guest must not be an immediate family member of the host. Furthermore, the guest must also not occupy the premises to primarily facilitate work or services to the host or share the accommodation with the host as part of an educational arrangement.
Who Needs a licence?
In March 2022, the Scottish Government issued an order under the Civic Government (Scotland) Act 2022 setting out regulations, which obliged Scottish local authorities to set up a licensing scheme for short term lets no later than 1 October 2022.
There are 4 types of short-term letting which require a licence:
- 'Home sharing' – the host shares their own home with the guest.
- 'Home letting' – the host rents out all or part of their own home to a guest but the host does not occupy the home during this period..
- 'Secondary letting' – the host rents out a home which does not constitute their main home.
- 'Home letting and home sharing' – the host rents out all or part of their own home whilst they are living there and also whilst they are not living there.
The order provides that it is an offence if someone who was letting out property on a short term let before October 2022 does not apply for licence before 1 October 2023. People who were not letting property on a short term basis before October 2022, must have a licence in place before 1 October 2023, otherwise they will be committing an offence. The deadline was initially 1 April 2023 but was extended due to the cost of living crisis.
While it is easy to think that the short term let licensing regime will apply only to "AirBnB"-style holiday accommodation, this is not the case and in fact the regime is much wider and can include guest houses and private rented student accommodation.
What is needed to comply with the safety standards?
The host will must meet the "fit and proper person" test and demonstrate that their property complies with safety standards The standards required reflect those already in place for long term lets. Operators of short-term lets are therefore required to exercise fire safety checks, install appropriate alarms, provide fire safety measures, and check gas and electrical safety.
Fire Safety
The host must ensure that the premises has 'satisfactory' equipment in place for identifying and giving warning of a fire (or suspected fire) and the presence of carbon monoxide in a concentration that constitutes a health risk. This means not only that fire alarms and carbon monoxide detectors are installed, but the host must also demonstrate that all upholstered furnishings and mattresses (for guest use) within the property comply with the Furniture and Furnishings (Fire Safety) Regulations 1988. The host must keep evidence of compliance (e.g. photos, receipts and retaining any fire safety labels). For those short-term lets which are 'home sharing', the host does not have to satisfy the requirements in areas of the premises to which the guest does not have access (e.g. the host's bedroom).
Gas Safety
The host of a short-term let which has a gas supply must organise an annual inspection of all gas pipes, flues and appliances in the property. Where an appliance fails to satisfy the required safety standard, the host must not let out the property to any guests until works have been carried out to bring the appliance to the desired safety standard.
Electrical Safety
Electrical fittings and appliances for guest use, or which the guests have access to must be in 'a reliable state of repair' and a 'proper and safe working order'. The host must organise an electrical safety inspection to be conducted by a competent person at least every 5 years and obtain an Electrical Installation Condition Report on any fixed installations. The host must also make arrangements for a competent person to issue a Portable Appliance Testing Report on moveable appliances and date, label and sign all such appliances which have been inspected.
Occupancy
The host must ensure that the number of guests staying in the property does not exceed the maximum number which is stated on the licence. The local authority may issue guidance on the maximum occupancy to assist with this and may also state on the licence that the guests can bring a specified number of small children who would not count towards the occupancy of the premises. A host will therefore need to provide information on the total number of bedrooms let out and the number of beds available for guest use.
What happens if you don't comply?
Failure to comply with the new regulations is an offence punishable by a fine up to £5,000. The new regulations do not set out the consequences for the host if their short-term let is used for illegal activity or if guests display anti-social behaviour.
If someone is injured or killed while staying at the property, the host could face a damages claim or even criminal prosecution.
Hosts and operators should consider their insurance policy and ensure that they have sufficient cover to reflect the new requirements and the possible liabilities arising from their letting business.
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