In what is becoming known as the Airbnb ruling, the Upper Tribunal last week gave guidance on what was meant by the term “a private residence” in a lease.
A landlord sought a determination from the Tribunal that its tenant was in breach of its lease of a residential flat. The lease contained a covenant not to use the premises “for any purpose whatsoever other than as a private residence”. The tenant had admitted to making short term lettings of the flat and advertising its availability on various websites like Airbnb.
The tenant stayed at the flat about three or four days a week and had let out the flat for about 90 days a year. The issue turned on whether using the flat for short term lettings breached the private residence covenant. The Upper Tribunal held that it did. It said that there must be ‘a degree of permanence going beyond being there for a weekend or a few nights in the week’. It went on to say ’the occupation is transient, so transient that the occupier would not consider the property he or she is staying in as being his or her private residence even for the time being’. It held that the tenant was in breach.
Websites such as Airbnb and Ownersdirect are very popular. People advertising properties on those websites need to ensure that they are entitled to do so, particularly where the property is leasehold. A failure to comply with the terms of the lease can have severe consequences for tenants. For landlords the decision is useful and is likely to be relied on by landlords seeking to limit the number of short term lettings at their properties.