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Navigate Edinburgh's Short-Term Rental Regulations: Key Rules and Insights for Property Owners

Edinburgh is one of the most popular cities in the UK, and over the years it has earned and cemented its position as a tourist and cultural destination for people of all ages. Edinburgh is a city with something for everybody, from students to music-lovers, architecture fans, film buffs, and theatre fans. Due to the high number of visitors that this city gets, Edinburgh properties deliver consistently good results for short-term rental landlords and property manager. According to stats from Airbnb in November 2022, the average daily rate per room in Edinburgh varies from £119 to £202 per season, with hosts bringing in an average monthly revenue of just over £2,500.

However, if you are currently managing an Airbnb in Edinburgh or are planning to do so in the future, it’s important to be aware of the important legislation changes for short-term rentals in Edinburgh that were brought about in 2022. On 19 January 2022, the Short-Term Lets legislation was approved by the Scottish Parliament, and Edinburgh Council implemented the Short-Term Lets Licensing Scheme at the beginning of October.

Important legislation changes for Airbnb hosts
The significance of the short-term lets legislation in Edinburgh.

Short-Term Let Control Area in Edinburgh

As of October 2022, UpperKey understands that any hosts with second properties that they want to rent in Edinburgh on a short-term basis will need to apply for planning permission before they will be permitted to continue hosting the property for rent on Airbnb. The short-term lets control area that has been established by Edinburgh City Council covers the entire local authority area and requires owners to get planning permission to operate any property that is not their primary residence as a short-term let. The main exception to this rule is if the property has already been operating as a short-term let for more than ten years.

Air B and B Edinburgh: Who is Affected By These Rules?

The short-term let control area rules apply only to hosts who are renting out an entire property, rather than renting out some of their primary residence. If you are renting out a room or several rooms in your own home, then you will not be affected by this. You will only have to apply for planning permission if you do not live in the property that you are advertising as a short-term let.

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How to Apply for Planning Permission for Short-Term Lets in Edinburgh?

If you currently have or are considering setting up a property for short-term renting in Edinburgh, then you will need to apply for and obtain planning permission in order to operate the property legally, say Upper Key. You can make an application easily online, with application forms available from the Edinburgh Council website.

In their decision-making, the council will consider the Development Plan and any other material considerations that are deemed to be relevant to your application. Any neighbouring property owners and occupiers within twenty metres of the property that you wish to rent out on a short-term basis will be notified of these plans as a part of the planning permission application.

Short Term Edinburgh: Planning Permission Applications

UpperKey reports that there is a fee payable for planning permission applications for short-term rending. This is based on the size of the property. The fee is £600 for a property with a gross floorspace of up to 100 square meters. For properties between 100 and 4,000 square metres, the fee is also £600, plus an additional £600 for each 100 square metres up to 4,000 square metres. Properties with a gross floorspace of more than 4,000 square metres have a fee of £24,000 for planning permission, plus an additional £300 per 100 square metres above 4000.

Symbolizing how planning permission fees vary based on the property's size
Planning permission fees for short-term rentals in Edinburgh.

What Can I Do if My Application is Rejected by Edinburgh Management?

If your planning application is rejected by the council or you do not get a decision regarding your short-term rental in Edinburgh within two months of submitting the application, then you can go through an appeals process. Once planning permission has been granted, either as a result of the application or as a result of going through the appeals process, it will become a part of the property and may be used by anybody, including any future buyers should you decide to sell the property in the future.

What Happens if a Property Does Not Have Planning Permission?

Under the new Planning legislation, Edinburgh Council is authorised to implement enforcement action to prevent unapproved short-term rentals from operating in the city. If you are running a short-term rental property in Edinburgh and do not have planning permission for it, then you will likely get an enforcement notice that will order you to cease operating the property for this purpose. The deadline that you will be given to comply with the notice can vary based on the council’s discretion, but they will need to give you a minimum of 28 days. Property owners who fail to comply with an enforcement notice and continue to operate their properties for short-term lets may be served with a fixed penalty notice from the council. Typically, this involves paying a fine of up to £2,000. For more serious issues or repeat offenders, fines may be issued up to £20,000.

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Short Term Let Edinburgh: Why Are These Legislations in Place?

Despite their high profitability for property owners and the recent drop in the number of properties being rented out on a short-term basis due to the COVID-19 pandemic, the impact of short-term lets on the housing ecosystems in major cities has long been an intensely debated issue throughout Europe and the UK.

In the past few years, the relevant authorities have struggled to contain the massive boom in short-term property lets in major cities around the world, and a lack of data has made it difficult for them to enforce limits on the number of properties in a building used for holiday lets or rental days, in order to manage the housing problem.

Managing the boom in short-term lets
The ongoing debate on the impact of short-term lets on housing ecosystems.

In July 2021, Airbnb was fined over eight million Euros by a Paris court, after apartments on the platform were found to be failing to comply with local regulations on short-term rets. Other European cities, such as Barcelona, have taken management methods such as banning short-term rentals of private rooms but allowing an entire apartment or house to be rented out on a short-term basis as long as the owner has the appropriate license.

Edinburgh is not the only city imposing stricter limits and regulations on short-term letting. In Amsterdam, for example, new regulations regarding buying properties mean that properties over a certain value are only permitted to be sold to owner-occupiers rather than short-term let investors.

Edinburgh is an excellent area for short-term lets, with millions of visitors to this city each year. But if you currently run or are considering running a short-term let in this major Scottish city, it’s important to be aware of the latest regulations you’ll need to comply with.


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