Airbnb is becoming a popular way of letting your extra room for a few days or weeks a year to tourists for a tidy income and serves as an alternative to hotels. Both homeowners and professional landlords are using it as a source of generating income. However, the success story can easily become a nightmare within a short time if a homeowner falls on the wrong side of the law.
Whether you own a flat or a house, it is worth checking whether you can use your property for short stays. Most property owners in London are either subject to a long term lease controlling how they should be used or a residential mortgage and building insurance policy, which contain contractual obligations on how the property should be dealt with. There are also planning restrictions on the use of residential properties.
Some leases restrict use of the property for residential purposes only and may further prohibit commercial use, or prevent letting of part of, or require the landlord's consent prior to any letting. If the lease contains restrictions, the safe approach is to comply rather than risk the consequences arising from a breach of your obligations as a leaseholder.
Lettings should not exceed 90 days a year otherwise it could constitute a material change of use requiring planning permission. A breach of planning could be sufficient grounds for a landlord to commence possession proceedings and seek to forfeit your lease. The local planning authority could also commence proceedings if it becomes aware of a breach.
If you have a mortgage check your mortgage covenants as unless you have a buy to let mortgage you are likely to require the lender's prior consent before letting your property.
You do not want to be on the receiving end of an injunction or find yourself before the First Tier Tribunal; take the necessary precautions.
Founded in 2008, San Francisco-based Airbnb has soared in popularity as homeowners welcome the way they can supplement their income by renting out rooms and properties for short stays to travellers. London now has the third highest number of listings in the world, reaching 25,357 homes at at the end of 2015, JLL said, behind Paris and New York. The figure in the capital at the end of 2009 was just 171.