Only three percent of landlords are currently engaged in the informal short-term lettings market, according to research by the National Landlords Association (NLA). Of those landlords who do not offer short-term lets, an overwhelming majority have not considered entering it, with only 24 percent of respondents reporting to have considered it at some point.

Short-term lets, which range in length from one night up to around six months, have increased in popularity in recent years following the success of companies such as Airbnb and HomeAway. Landlords can generate significant income from letting their properties in this way.  However, this can breach a landlord’s mortgage terms and invalidate their existing insurance policy, so it’s vital for them to be aware of the problems it can present.

There had been an expectation that there would be a slight increase in the number of landlords letting furnished holiday properties after changes to taxation were introduced in April last year. While this has not been the case for most of the UK, it is worth noting that 20 percent of landlords in Scotland do offer short-term lets. The NLA in summarising its research, suggested that, as holiday lets are treated very differently to other property portfolios in tax and regulatory terms, the decision to switch may be a ‘no-brainer’ for landlords in areas where there is strong demand from temporary visitors, particularly as there is are no real downside and nothing holding them back from doing so.

However, a shift of properties in a concentrated area to shorter-term letting may have a significant effect on the local rental market, potentially reducing available properties and pushing up rents.  There can always be unintended consequences as a result of policymakers who don’t make the effort to understand landlords’ motivations and behaviour.


One response to “Long term thinking”

  1. Emilia says:

    Hi, very nice website, cheers!

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