This week the Department for Communities and Local Government released a Policy Paper on Promoting the sharing economy in London. The amendments actually allow the Secretary of State to make regulations. This paper sets out the response to the Governments consultation and its intended plans. Its aim is to change the bureaucratic and disproportionate law surrounding the prohibition on short-term lets in London with amendments proposed under the Deregulation Bill which is to be debated in the House of Lords this week. My colleague David Smith highlighted these amendments when they were initially proposed here.

Currently, residents in London are prevented from renting out their properties for less than 90 days, under s.25 of the Greater London Council (General Powers) Act 1973. This provision provides that use of residential premises for temporary sleeping accommodation for less than 90 consecutive nights is a material change of use for which the resident must seek planning permission from their respective local authority. Residents who contravene this legislation face a potential fine of up to £20,000 for each separate offence, or short let.

The Government is attempting to bring London letting into the 21st Century. With short letting sites such as ‘Airbnb’ revolutionising the way tourists visit the Capital. it is recognised that is becoming difficult for local authorities to enforce. It is thought that a relaxation in the legislation will have a beneficial impact on London’s tourism industry providing alternatives to hotels and guesthouses and allowing visitors to live among “ordinary” Londoner’s.

So is this the end to the Governments prohibition on short term lets in London? Unfortunately it is not that simple. There is still plenty of opposition to the proposed relaxation. Some residents fear that their block of flats will effectively become hotels causing nuisance from weekend party goers visiting the Capital.

The planned relaxation does have its restrictions. The Government does not intend for residents to effectively start their own short-term letting business from their bedroom. Under the proposed changes short-term letting of a residential premises will be limited to a maximum of 90 days in any one calendar year. The idea is to avoid properties from being used as temporary sleeping accommodation on a permanent basis throughout the year. Further, to ease fears over an increase in anti-social behaviour the Government will introduce the following safeguards:

{C}i) A local authority will have the power to withdraw the relaxation from particular properties where there is a successful enforcement against a statutory nuisance;

{C}ii) In exceptional circumstances, local authorities will be able to request that the Secretary of State grants a localised exemption to the relaxation, where there is a strong public interest in doing so;

{C}iii) The resident must be liable for Council Tax to benefit from the relaxation.

It is important to note that the relaxation is primarily intended to benefit homeowners and not landlords running a commercial short-letting operation. It is also important to understand that the reforms will not affect any existing clauses in leases which prohibit tenants from sub-letting. This is not a complete repeal of the current legislation but merely a slight relaxation.