Hundreds of holiday lets in Edinburgh are still taking bookings despite having been refused planning permission, according to new analysis by housing campaigners that has renewed pressure on the city council and the Scottish Government to close what critics call a loophole.
The figures, compiled by the tenants’ union Living Rent and Leith Harbour and Newhaven Community Council from publicly available planning and licensing records, show that on 6 September this year 1,754 entire flats or houses in the city held short-term let licences.
Of those, 1,225 did not have planning permission, either because none had been sought, in some cases because it was not required, or because it had been refused. In 800 cases, planning consent had been refused and not subsequently granted on appeal.
Because they hold valid licences, those properties can continue to operate and advertise on websites such as Airbnb until their licence is due for renewal, typically between one and three years after it was issued.
How the rules work
Scotland’s short-term let licensing law came into force in 2023 to address housing pressures and antisocial behaviour, particularly in hotspots such as Edinburgh. Anyone providing short-term let accommodation must hold a licence or face a ban and a fine of up to £2,500.
Edinburgh became Scotland’s first short-term let control area in September 2022. Any whole property that began operating as a holiday let after that date must also have planning permission if the owner does not normally live there, and some properties that changed use before then also need consent.
Applicants for a licence in Edinburgh must either have the correct planning permission or be in the process of applying for it. Campaigners say some owners are “gaming the system” by submitting a planning application, securing a licence and then withdrawing the application. Living Rent’s analysis found that 465 licensed whole-property lets had withdrawn a planning application at least once, and 110 had done so more than once.
Properties in residential tenements and in areas with a high concentration of holiday lets are among those most often refused. The council has the power to take enforcement action, including fines, against owners operating without permission, but enforcement is discretionary and must be reasonable and proportionate.
‘A loophole as big as a barn door’
Chas Booth, a Scottish Green councillor for Leith who sits on both the licensing and planning committees, said the council was not doing enough and that the legislation was not fit for purpose. “There is a massive loophole in the law, which hundreds of STL owners are exploiting, and which is causing misery for residents,” he said, calling on ministers to “wake up and smell the coffee”.
Niall Robb of Living Rent said residents who “keep the city ticking over every day” were being forced out by high rents and a lack of homes, and accused landlords of exploiting weak legislation and weak enforcement.
Leith resident Katie Beale described constant noise and turnover from a holiday let in her stair, including guests running through hallways, pressing every buzzer and throwing items from windows. “Your stomach just drops when you hear the wheelie suitcases coming up the street,” she said. She added that visitors were welcome in Edinburgh, “they just need to be in the right places”.
Operators say the system is broken too
Paul Phillips, who owns a city-centre holiday let and is a non-executive director of the Association of Scotland’s Self-Caterers, said his is one of the 800 licensed properties refused planning permission. He said it operates without causing problems for neighbours but expects it to close when he must reapply for a licence. He estimated he had spent about £8,000 seeking the necessary permissions and called for the rules to be adjusted so that long-established, trouble-free businesses could continue.
City of Edinburgh Council said it had 329 active short-term let enforcement investigations, 117 involving licensed properties and 212 involving unlicensed ones. Thirty-two cases, covering 52 offences, have been reported to prosecutors. Last year the first owner convicted of running an unlicensed holiday let in the city was fined £600.
Council leader Jane Meagher said the licensing policy was helping to make holiday lets safe and properly regulated, that the planning committee had agreed to write to the Scottish Government seeking solutions, and that six additional full-time staff had been recruited to check that operators held licences.
Public finance minister Hannah Mary Goodlad told Holyrood last month that councils could already refuse to consider licence applications where they believed planning control had been breached, and that planning authorities could take enforcement action against properties operating without required consent.
