Council set to take over short-term lets in the capital and use them as homeless accommodation

High rents and a lack of affordable housing have pushed many families in the affluent capital into homelessness – amid a warning there are now more Airbnb-style short term let properties in the city centre than there are traditional private rented homes. 

But that could be set for an overhaul as council leaders use the emergence from the Covid-19 lockdown as an opportunity to rebalance the needs of residents and those of visitors. 

READ MORE: Edinburgh Airbnb flats help solve homelessness crisis

However, ending what critics label as an out-of-control spread of the tourism industry could come at great cost, just when Edinburgh needs a boost to its economy. 

Initial research suggests that almost £1 billion in visitor spending will be lost from the city’s economy in 2020 – amid a warning that “Edinburgh is facing a higher impact and potentially slower recovery than the rest of Scotland”. 

During the lockdown, empty hotel accommodation and short term let apartments have been harnessed to look after the city’s most vulnerable people, with MSPs told on Thursday that rough sleeping “is almost now non-existent on the streets of Scotland.” 

But that is a temporary fix with hotels and apartment owners in Edinburgh desperate to re-open their doors to the world when it is safe to do so. 

Since the start of the lockdown, hundreds of landlords have offered up properties to the city council to let them use as an affordable home in exchange for a guaranteed rent – something many Airbnb owners have been unable to obtain during the pandemic. 

But council chief believe this strategy, in partnership with Link Housing, will be ramped up as Airbnb owners see the writing on the wall – with the Scottish Government planning on bringing forward plans to give councils the ability to curb the influx of short term lets with licensing rules. 

The Scottish Government has currently put its plans for licensing rules on hold to focus on the pandemic but is committed to restarting the process “as soon as possible”. 

The city council wants the “location, character and suitability of properties” to be relevant to a licence being issued. 

This raises the prospect of tenement flats with shared stairs being seen as unsuitable for Airbnb operations, matching the city council’s current planning guidance – while the Scottish Government is paving the way to allow “short-term let control areas” to be introduced. 

Edinburgh’s housing convener, Kate Campbell, said: “We know that where we have a high concentration of short term lets, we have seen rents increase by as much as 30 per cent. We also know that we’re still seeing an increase in households presenting as homeless coming from the private rented sector because they can’t afford their rent. 

“It’s hard not to make a connection between the proliferation of short term lets and homelessness in our city. 

“Prior to the crisis caused by coronavirus, we had been working hard to make the case for a licensing regime for short term lets to the Scottish Government.

"They had agreed to bring forward legislation and we were making the case for getting the powers we need to control the overall numbers, concentration, health and safety and to make sure landlords are fit and proper and crucially also to determine what type of property is suitable. Our planning guidance already states that tenement properties are unlikely to be suitable for short term lets because of the impact on neighbours.” 

She added: “We’re asking short term let landlords now to think about what the future holds as well as the situation that they currently are in and make a choice that is not just better for the city and will make housing more affordable and available to residents, but which is also better for them in the long term. 

READ MORE: Airbnb blocks holiday bookings

“The Private Sector Leasing Scheme (PSL) means landlords can hand over their property for three or five years knowing that it will be completely managed for them, they will have guaranteed income, and the property will be returned to them in the same condition that they put it into the scheme. The benefit for us is that properties that had been businesses return to their proper use as homes.” 

Residents have welcomed the steps being taken to return properties to their original use. 

Rosemary Mann, treasurer of the Edinburgh Old Town Association, said: “Short-term lets have had a devastating effect on stairs, streets and, above all, the community.   

“Returning these properties to true residential use is essential and we welcome initiatives to limit the use of homes for non-residential use and revive our community.” 

Festival bosses, many of whom are struggling to survive the shutdown brought on by Covid-19 may be concerned by the potential shift.

As well as visitors relying on Airbnb-style accommodation over the summer months, performers who need to stay in the city for the whole of August have become dependent on short term let accommodation as well as empty university halls. 

Shona McCarthy, the chief executive of the Edinburgh Fringe Festival Society has warned that “the single biggest issue has been finding accommodation and cost of accommodation in Edinburgh”. 

The industry says it is embracing the proposed licensing regime – with the self-catering sector set to be key to Scotland’s economic recovery. 

Association of Scotland’s Self-Caterers (ASSC) chief executive, Fiona Campbell, said: “We at the ASSC are fullycommitted to promoting responsible tourism and have taken an active role over the past few years in working towards that goal, including putting forward innovative and industry-leading proposals on short-term let regulation, including on tackling community concerns around housing.

“As the trade body representing traditional self-catering, we have the knowledge, skills, and experience among our members to play an important role in shaping the future of Scotland’s vital tourism offering which contributes so much to Edinburgh, as a culture capital and festival city, and to Scotland’s wider economy.”

She added: “We will continue to make that positive contribution in the weeks, months, and years ahead and will also continue to call for a proportionate, balanced, and evidence-led approach.

“Self-catering provides an annual £723 million boost to our country and will be an important part of our economic recovery as plans are made for the restart of the tourism sector in Scotland.”

Airbnb is sceptical that many of its “hosts” will give up their successful business ventures – claiming the estimated 14,000 listings had an estimated economic impact of more than £400 million in Edinburgh in 2019.

A spokesperson for Airbnb said: “The majority of hosts share their own home and half say that the additional income is an economic lifeline, which is why more than 90% of hosts say they plan to share their home at least as often as before the pandemic once it is safe to do so.

“Travel on Airbnb boosted Edinburgh’s economy by more than £1 million a day last year alone and we will continue to work with the government to rebuild tourism to work for everyone in Scotland.”

READ MORE: Coronvirus comment: it shouldn't take a pandemic to show we can end rough sleeping

Housing Minister Kevin Stewart said: “The Scottish Government’s primary focus at this time is on keeping the people of Scotland safe and well in the face of the Covid-19 pandemic emergency. Our efforts are focused on responding to this emergency and helping people and organisations across the country with all the changes it necessitates.

“This means that a lot of planned work has had to be put on hold. Our work on short-term lets is currently paused but we plan to recommence work as soon as possible.”