Section 25 of the Greater London Council (General Powers) Act 1973 provides that the use of residential premises for temporary sleeping accommodation for less than 90 consecutive nights in London is a change of use, for which planning permission is required. London residents faced a possible fine of up to £20,000 for each ‘offence’ of failing to secure planning permission. However, from the 26 May 2015, Section 44 of the Deregulation Act relaxed the temporary visitor accommodation rules, set out in Section 25 above.
The Deregulation Act means that the use of any dwelling in London as temporary visitor accommodation does not constitute a material change of use (or require planning permission), if the two following conditions are met:
1) the number of nights of that the dwelling is used as temporary sleeping accommodation does not exceed 90 days, within a calendar year; and
2) that the person (or at least one person) who provided the sleeping accommodation for the night was liable to pay council tax, under Part 1 of the Local Government Finance Act 1992, for the property.
However, research reports identified that many London landlords listed on AirBnB advertised their properties as available for more than 90, in breach of the Deregulation Act. The main concern with this is of course that as Holiday lets, landlords were not complying with regulations, safety and insurance provisions that normally apply to the private rented sector.
AirBnB came under a lot of criticism for failing to manage these lettings and appear to have taken on board the criticism and actively tackle the problem. From 1 January 2017 AirBnB’s system will automatically limit listings in London to 90 nights a year, unless landlords confirm that they have the required Section 25 planning permission. AirBnB confirm that existing bookings which exceed the 90 days will be honoured but that after 1 January 2017 no such bookings will be possible.
This will help someone landlords who have found their properties being advertised on AirBnB and other portals by unscrupulous tenants acting in breach of contract. However, at a time when landlords are under increasing financial pressure the narrowing of letting options will be a concern for some.