New short-term lets licensing in Scotland
As first proposed in September (2022), the Scottish Government has now enacted the short-term letting licensing laws for both new and existing hosts. This move aims to safeguard local propertiers and foster community respect through adherence to new regulations by licensed hosts.
Local authorities in Scotland are now tasked with rolling out area-specific licensing schemes to ensure a regulated environment across the board. Existing short-term let owners had until 1st October 2022 to apply for a licence, with a final deadline of 1st January 2025 for all properties to be licensed for continued operation.
Explore the essentials of the new licensing requirements and the impact of Scotland’s short-terms lets licensing scheme on your hosting journey.
A new licensing scheme for the short-term lets was introduced by the Scottish government
What is the short-term let legislation in Scotland?
As of 2022, Scotland introduced pivotal changes to the legal framework governing short-term lets. Operating such accommodations now mandates a licence, with owners obliged to adhere to the updated legislation. Local authorities have been empowered to assess the safety of accommodations for guests and their contribution to the local community’s well-being.
Mirroring approaches in other European countries, the legislation aimed to curtail the unchecked expansion of short-term lets lacking in safety and quality oversight, particularly in areas where they disrupted local harmony and housing availability.
This legislation serves as a safeguard for housing quality, offering protection for both guests and owners against various issues. The government has actively supported local authorities in ensuring properties align with voter expectations, discouraging substandard short-lets and advocating for a greater number of residential properties that comply with essential safety norms.
This regulatory measure has refined the short-term let landscape in Scotland, leading to an increase in nightly rates and occupancy due to a more balanced supply-demand dynamic. This shift has been beneficial for numerous owners.
Scotland offers four licensing options for short-term lets:
- Secondary Letting: Renting out a property that isn’t the owner’s principal home.
- Home Letting: Offering the principal residence for short-term lets when it’s vacant.
- Home Sharing: Renting out a part of the principal residence during vacancies.
- Mixed Letting: A combination of Home Letting and Home Sharing.
The licensing scheme, now fully in effect, spans these categories and introduces comprehensive safety protocols to encompass the broad array of properties operating as short-term lets in Scotland. Properties undergo thorough inspections to meet specific criteria before being awarded a licence, ensuring a secure and dependable short-term rental market.
What is the purpose of the new licensing scheme in Scotland?
The licensing scheme introduced by the Scottish Government wants to ensure short-term lets are safe and promote a better management of the issues created by this line of business, paying particular attention to its impact on the local communities.
The licensing scheme process empowers local authorities, making them responsible for assessing concerns and handling any related complaints in their area. In many ways, this new short-term regulation in Scotland aims to make sure that the economic benefits from this business and the needs of local communities are well balanced, protecting people from poor quality housing as well.
Who is the short-term lets licensing scheme for?
The new licensing scheme will apply to all residential accommodations operating as short-term lets (excluding privately rented properties used as permanent homes, hotels, hostels, care homes, worker accommodation, among others). This scheme applies to the whole of Scotland and will be implemented by the 32 local authorities.
Some examples of what are considered to be residential short-term lets:
- B&Bs and guesthouses
- Boathouses
- Chalets
- Cottages and farmhouses
- Holiday caravans and glamping
- Lodges
- Self-catered properties/holiday lets
- Serviced apartments (up to 4 in the same building)
- Shared rooms or shared house
- Tents / tipis
- Treehouses
- Yurts
What are the temporary exemptions and how are they granted?
The temporary exemptions from the requirement to have a licence are granted by the local licensing authority to short-term lets whenever exceptional circumstances are in place. To get a temporary exemption, you need to apply for it and meet specific criteria.
It can be granted for a single continuous period (not exceeding 6 weeks in every 12 months) to allow, for instance, to accommodate a large number of visitors over a short period (during music or art festivals, sports events, major conferences…).
Even when this exemption is granted, it is temporary and it does not affect the way rules apply. The short-term accommodations still have to respect those standard regulations.
What are the temporary licences and how are they issued?
Licensing authorities can issue temporary licences that can last for up to six weeks. It can last longer if you have already applied for a full-time licence.
In that case, your temporary licence will last until your licence application is finally determined. You will be given a temporary licence number but all the mandatory conditions and requirements still apply.
How to comply with the new short-term lets legislation in Scotland?
All short-term lets in Scotland need to follow mandatory requirements that are linked to the safety of the activity. It’s important to confirm whether the property meets the short-term let licensing standards required by law and this can be checked here in detail.
Every short-term let application also requires consultation with:
- Police Scotland
- The Scottish Fire and Rescue Service
- The council’s Environmental Health Service
- Planning and Building Standards departments
Property management companies can be very helpful in this process. GuestReady’s experience in property management means that none of these elements are overlooked. Not only do their teams take the time-consuming work out of your hands, but they also ensure that you don’t miss anything and that you stay up to date when it comes to compliance with newly enacted legislation.
What are the timelines for the new licensing scheme in Scotland?
As of September 2023, all short-lets within Scotland have been required to have a license granted or a license application under review by their Local Authority. From the 1st January 2025, all properties operating as short-lets are required to have a license.
Do you need planning permission for short-term lets in Edinburgh?
The Scottish capital faces stricter rules. Edinburgh Council has announced that the entire city is now included in the short-term let control area that was approved by the Planning Committee on 23 February 2022.
This means that all owners that rent out an entire property in Edinburgh that is not their primary residence, will need to apply for planning permission.
Some nuances apply: in case you have been renting your property for at least ten years, you can apply for a certificate of lawfulness and dodge this application. If you are hosting in your primary home, however, this “planning permission” rule does not apply and you can continue business as usual.
Learn more about the licensing scheme in Scotland with GuestReady
GuestReady has years of experience working with short-term lets management. We know how to take care of your property and how to comply with regulatory requirements. If you are looking to obtain a short-term let licence in Scotland, just leave us a message. We will call you back and help you through the process.
In addition to management and investment services, GuestReady also offers an exclusive direct booking website for its owners and ensures excellent visibility with the publication of ads on the main online rental platforms.
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