Housing Minister to reform "outdated" laws on short-term letting in London

The Housing Minister has announced plans to reform the “outdated” legislation on short-term letting of residential accommodation in London in a bid to boost what he called the ‘sharing economy’.

Brandon Lewis said in a written statement to Parliament that a new clause would be introduced through the Deregulation Bill.

The current legislation – 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 therefore face a possible fine of up to £20,000 for each ‘offence’ of failing to secure planning permission.

Lewis said each of the thousands of London properties advertised on websites for use as short-term accommodation was potentially in breach of Section 25 as it stood.

“The current outdated legislation is inconsistently enforced, leading to confusion and uncertainty for householders, as was apparent during the 2012 Olympics,” the minister said.

He added: “These laws do not operate outside London, without any visible adverse effect. We want to update these laws to help boost the sharing economy, in light of the popularity of websites like Airbnb and Onefinestay to help people rent out their property for a short-term basis.”

The Department for Communities and Local Government has published a policy document setting out its plans for modernising the legislation.

“The government wants to enable London residents to participate in the sharing economy, and enjoy the same freedom and flexibility as the rest of the country to temporarily let their homes, without the disproportionate burden of requiring planning permission,” Lewis suggested.

The minister said the changes would not affect any existing clauses in tenancy contracts which prohibited sub-letting by tenants.

A number of safeguards have been put forward:

• Short-term letting of residential premises will be restricted to a maximum of 90 days in a calendar year, “so that properties cannot be used for short-term letting on a permanent basis throughout the year”;
• To benefit from the new flexibility the properties must be liable for council tax (thereby excluding business premises);
• The new flexibility can be withdrawn following a successful enforcement action against a statutory nuisance; and
• In exceptional circumstances local authorities will be able to request that the Secretary of State agrees to small localised exemptions from the new flexibility, “where there is a strong amenity case to do so”.

Lewis said he hoped these “practical concessions” would illustrate that the Government had carefully listened to the points made by Parliamentarians in both Houses in recent months.