Industry News Sally Walmsley 20/02/2024

Councils to get new planning powers to control growth of holiday lets

New planning rules are being introduced to help local authorities control numbers of new holiday lets in their area.

Announcing the plans the Government said the changes will help protect local communities and the supply of homes to rent and buy.

The changes will see a new planning ‘use class’ created for short-term lets – properties not used as a sole or main home – a move which the Government says will allow local people to ‘take back control’ and prevent the ‘hollowing out’ of communities.

Essentially this means councils will be able to refuse to allow homes to be used as holiday lets if, for example, they believe there are already too many in the area, much in the same way that Article 4 Directions can limit the number of HMOs.

Why is the Government making the change?

Families throughout England and Wales, particularly those in popular tourist hotspots, have complained locals are being priced out of the housing market, unable to rent or buy.

Some areas – particularly in costal resorts in areas such as Wales and Cornwall – say towns and villages are becoming ‘ghost towns’ in the winter months, when holiday lets are not in use.

Under the new plans the Government also intends to develop a new mandatory national register will give local authorities the information they need about short-term lets in their area.

This will include the number of properties, the impact on the community and help them ensure properties are compliant with health and safety rules.

What about existing holiday lets?

The Government has yet to detail exactly how the scheme will work in practice, however it has confirmed existing short-term lets will not be affected and automatically be reclassified, without requiring a planning application.

In addition to this, homeowners can continue to let out their own main or sole home for up to 90 nights a year, for example through platforms such as Airbnb.

It has also committed to introducing ‘permitted development rights’ which will allow properties to transfer from short term lets to standard dwellings – or vice versa – in certain circumstances.

It has not yet detailed what these would be – but said councils would be able to remove these permissions and require full planning permission if they deem it necessary.

This will allow flexibility in areas where the proportion of holiday lets is not considered to be an issue.

Announcing the plans, which follow consultations last year, Housing Secretary Michael Gove said: “Short-term lets can play an important role in the UK’s flourishing tourism economy, providing great, easily-accessible accommodation in some of the most beautiful parts of our country.

“But in some areas, too many local families and young people feel they are being shut out of the housing market and denied the opportunity to rent or buy in their own community.

“So the government is taking action as part of its long-term plan for housing. That means delivering more of the right homes in the right places and giving communities the power to decide.

“This will allow local communities to take back control and strike the right balance between protecting the visitor economy and ensuring local people get the homes they need.”

The NRLA has been campaigning for changes to the rules around holiday lets to tackle the supply crisis in the private rented sector.

Currently holiday lets are taxed more favourably than privately rented homes, which the association believes is unfair.

NRLA chief executive Ben Beadle said: “These changes are being introduced as a result of taxation changes which make it more attractive to rent a property in the holiday letting market rather than to a family in the private rented sector.

"The best way to control holiday lets is to reverse the damaging mortgage interest relief changes introduced back in 2015. These changes have served only to decrease supply, heighten demand and increase rents in the process."

More information

To read the Government announcement on the changes, due to be brought in this summer click here.

Sally Walmsley

Sally Walmsley Magazine and Digital Editor

Sally is the Magazine and Digital Editor for the NRLA. With 20 years’ experience writing for regional and national newspapers and magazines she is responsible for editing our members' magazine 'Property', producing our articles for our news site, the weekly and monthly bulletins and editorial content for our media partners.

See all articles by Sally Walmsley