U.K.: Can You Airbnb?

U.K.: Can You Airbnb?

The rise of the “sharing economy” has led to the enormous success of companies like Airbnb, Under The Doormat, and VRBO which facilitate people letting their homes or spare rooms on a short-term basis. PWC reports that the sector will grow from £15bn in 2013 to £335bn by 2025. The legal position in relation to short-term lettings is still evolving around the globe. In England, you are able to let your home on tenancies for up to a maximum of 90 days in any year without planning permission. To do this, you will need to comply with all of the relevant legislation that applies to the letting of residential properties, as well as pay applicable taxes on the income received, with certain caps and floors. You must also ensure proper insurance coverage.

Ally Law Airbnb legislation

Under the principles of English landlord / tenant law, other regulations and laws may apply depending upon whether you own a freehold property or are a leaseholder. In both instances, you will need to check your deeds and mortgages for prohibiting covenants. There have been a couple of recent cases where freeholders have successfully argued that the user provisions of leases effectively prohibited leaseholders from letting their properties on a short-term basis, so leaseholders may need advice as to the scope of any user provisions. If you are negotiating a lease, be aware that most standard leases used were drafted before the “sharing economy” concept and probably do not adequately address the issue.

Your Ally Law member firm attorney can advise you on the provisions of your lease as it relates to short-term letting. In fact, Ally Law member firms around the world are reviewing and advising on many types of contractual provisions to account for any “sharing economy” applications in housing and other industries. For more information about Ally Law member firm services in this area, contact us at team@ally-law.com.

Click here for the original article by James Davies of Ally Law member Edwin Coe LLP.

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