Local government has been raising concerns about the impact of unregulated growth in this sector for some time. It is a national issue, with the impacts of short-term letting found across the country. We have drafted this response alongside our response to the DCMS consultation on introducing a registration scheme.
About us
The LGA is the national membership body for local authorities and we work on behalf of our member councils to support, promote and improve local government. Our core membership comprises 315 of the 317 councils in England and includes district, county, metropolitan and unitary authorities along with London boroughs and the City of London Corporation.
Our Associates include fire and rescue authorities, police, fire and crime commissioners/police and crime commissioners, national park authorities and town and parish councils via the National Association of Local Councils (NALC)’s corporate associate membership.
Our members are responsible for shaping and managing our communities, with responsibilities covering environmental health, licensing and regulation, fire safety, housing, highways and planning services. All of these services support, and are affected by, the local visitor economy and accommodation providers.
We have engaged with all our members and conducted more in-depth conversations with areas that have identified this as a particular challenge for their communities. This is a summary response outlining areas of consensus and key areas of concern for local government in their role as place-shapers. Many of our members will also submit their own responses outlining their specific local context and associated evidence base.
Key messages
Local government has been raising concerns about the impact of unregulated growth in this sector for some time. We welcome Government’s exploration of the issue, including this consultation which responds to recommendations put forward by our members. We look forward to supporting Government to take meaningful action to rebalance the impacts of this growth industry.
It is a national issue, with the impacts of short-term letting found across the country. However, it is not an issue in every council area, with some councils seeing little growth and others reporting growth of between 30-52 per cent in short-term lets. Our members report particular challenges in visitor ‘honeypots’ destinations such as coastal areas, particularly in the South West and East of England, as well as in core and key cities.
We believe this indicates the need for regulation that allows local discretion and implementation, ensuring that the response is proportionate for those places without significant challenges while also enabling those places with significant impact on their communities to take action.
Members have also indicated that it is important to not discourage those lets which provide flexibility to people who only occasionally let a spare room. This suggests a tiered approach based on risk and impact of the short-term let, avoiding the need for excessive bureaucracy or red tape that will unfairly hold back smaller businesses.
It is clear that the current lack of registration and regulatory requirements for these businesses makes it hard to quantify and assess the scale of impact. While there is extensive and comprehensive anecdotal evidence of the growing impact of this type of accommodation, there are few opportunities to record and quantify the impact on communities and services.
We have drafted this response alongside our response to the DCMS consultation on introducing a registration scheme. It will be vital that both the planning use class changes and the registration scheme are introduced alongside each other, as neither will be effective without the other mechanism.
Questions
Q.1 Do you agree that the planning system could be used to help to manage the increase in short term lets?
Yes. Short term lets have a material impact on the communities where they exist and the planning system exists to manage competing pressures on local land use and establish a positive future vision for the community.
This will bring short term lets into line with other types of use in order to allow local planning authorities to duly manage their areas, as they are charged to do under various planning and housing acts.
Only a local authority has responsibility for considering the direction of their area and managing competing demands. This is why it is critical they have the right tools for the job, and their responses to this consultation must be weighted accordingly even though they will not be the most numerous type of respondent.
Q.2 Do you agree with the introduction of a new use class for short term lets?
Yes. This is an effective and powerful tool that recognises the importance of effective management of short term lets to maximise the positive impact on communities and mitigate any pressures they may cause.
Introducing a use class tool is also a straightforward and easily communicated requirement to owners of short term lets, which makes it more attractive than more complex pieces of regulation that could be applied.
Q.3 Do you agree with the description and definition of a short term let for the purpose of the new use class?
‘Use of a dwellinghouse that is not a sole or main residence for temporary sleeping accommodation for the purpose of holiday, leisure, recreation, business or other travel.’
Yes, we have tested this definition with members and there is broad satisfaction with it.
Q.4 Do you have any comments about how the new C5 short term let use class will operate?
The outline proposals seem sensible. However, there will need to be additional clear guidance to address properties identified as having ‘unclear status’, which we believe could include those properties that are empty or undergoing refurbishment.
There is also a particular consideration that needs to be given to existing legislation in London, and whether this new legislation supersedes it or works alongside it. Our members are united in believing there is a need for the registration scheme and some supplementary planning powers. However, London authorities are broadly content with their existing powers (Greater London Council (General Powers) Act 1973 and Deregulation Act 2015) provided the registration scheme, being consulted on by DCMS, is also introduced to help track compliance with the 90-day rule and is fit for purpose with appropriate data-sharing mechanisms in place.
We would direct DLUHC to responses provided separately by London Councils and Westminster City Council, among other London authorities, for a more detailed response on the specific situation in London. We believe this is an opportunity for Government to demonstrate a commitment to devolution and acknowledge locally tailored legislation, while also providing effective powers to authorities elsewhere.
Q.5 Do you consider there should be specific arrangements for certain accommodation as a result of the short term let use class?
Student accommodation, as the example given, is an effective example and the most obvious one requiring consideration. We note that there tend to be 84 days in school holidays, which lends weight to adopting 90 days as the marking boundary for anything over that being considered a short term let requiring regulation.
New national permitted development rights
Q.6 Do you agree that there should be a new permitted development right for the change of use from a C3 dwellinghouse to a C5 short term let (a)
No. The LGA has long called for permitted development rights to be urgently revoked as they undermine and weaken the role of Local Plans and local communities in decision-making. Extending these rights to permit the change of use from C3 dwellinghouse to C5 short-term let seems at odds with the premise and purpose of creating a new use class for short-term lets, “to allow for greater local control”, as local authorities and communities will have no say in their location, size and quality.
Permitted development rights simplify the planning process for businesses by reducing the burden of evidence and policy compliance for schemes, but this compromises councils’ ability to manage housing supply at a time where there is a significant shortage of housing and inability to increase supply fast enough to compensate. This shortage is already having a direct impact on the visitor economy with key workers unable to secure accommodation in proximity to where they work.
The default in the planning system should therefore be that residential use class and a short-term letting (commercial) use class are wholly different and any movement between those classes should be under the jurisdiction of local planning authorities. These authorities are also the local housing authorities with a comprehensive understanding of local housing needs in proportion to economic needs of tourism.
Notwithstanding our position that the traditional planning application route to determine change of use should apply across the country, unless devolved legislation exists, making provision for use of an article 4 direction should the government proceed with the new permitted development right will allow those areas most affected to put in place appropriate measures for their communities. We would urge the Government to engage directly with councils who have identified their intention to introduce article 4 directions to remove these permitted development rights in order to understand the type and detail of evidence required to meet the requirements of NPPF paragraph 53. Further, Government should consider delaying the introduction of these permitted development rights for one year to allow local authorities sufficient time to develop and adopt their article 4 directions.
Q.7 Do you agree that there should be a new permitted development right for the change of use from a C5 short term let to a C3 dwellinghouse (b)
As above, we do not support the use of permitted development rights as they undermine local authorities planning policies and communities in decision-making. However, if the use class is introduced, it would be desirable to have the simplest mechanism possible to return a short term let to the general housing stock.
Q.8 Do you agree that the permitted development rights should not be subject to any limitations or conditions?
No – as stated above, permitted development rights undermine Local Plans and local policies which are in place to develop and protect local amenity. It is inappropriate for Government to introduce C3 to C5 rights and not have any limitations or conditions on their use. In particular, it is not appropriate to not consider the safety, quality or heritage implications for changes of use to listed buildings.
With regards to C5 to C3, it is inappropriate for the Government to not apply conditions or limitations to such changes of use as certain short-term lets may not, for example, reach national space standards or may be situated in inappropriate or undesirable locations both in terms of immediate location and with regard to local and neighbourhood planning policies. Further, as dwellings created through permitted development rights are not subject to developer contributions, local authorities and communities lose out on vital infrastructure contributions as well as affordable housing.
Q.9 Do you agree that the local planning authority should be notified when either of the two permitted development rights for change of use to a short term let (a) or from a short term let (b) are used?
Yes – notwithstanding our position on permitted development rights, in order for local authorities to have a true understanding of the number of short-term lets in their area, alongside the registration scheme, they should be notified when either of the two permitted development rights are used.
Q.10 Do you have any comments about other potential planning approaches?
No.
Flexibility to let out your own home
Q.11 Do you agree that we should expressly provide a flexibility for homeowners to let out their homes (C3 dwellinghouses)?
Yes. In London, the Deregulation Act 2015 relaxed rules on planning permission to make it easier for individuals to become STL ‘hosts’. It enabled Londoners to lawfully let their home on a short-term basis for up to 90 nights in a calendar year without seeking planning permission (90-day rule). The Government’s explanatory note clarifies this policy is aimed at benefitting residents, not providing opportunities for the commercial sector. Unfortunately, that initial ideal has been compromised as the sector becomes increasingly commercialised, depriving London of much needed permanent housing, and leading to other deleterious effects explored through this paper.
Whether this is feasible as a national policy very much depends on the outcome of the Registration Scheme consultation, as currently in London, this policy is close to 100 per cent ineffective.
Q.12 If so, should this flexibility be for:
i. 30 nights in a calendar year; or
ii. 60 nights in a calendar year; or
iii. 90 nights in a calendar year
90 days allows households flexibility, while restricting opportunities for commercial operators to hold properties exclusively for STL. It fits in with the number of days that are permitted for school holidays, allowing families to benefit from renting out properties during part of that period, and it aligns closely with payment boundaries for council tax and other tax regimes.
Q.13 Should this flexibility be provided through:
i. A permitted development right for use of a C3 dwellinghouse as temporary sleeping accommodation for up to a defined number of nights in a calendar year
ii. An amendment to the C3 dwellinghouse use class to allow them to be let for up to a defined number of nights in a calendar year.
We prefer option ii), as outlined in our responses to the other questions.
Planning application fees
Q.14 Do you agree that a planning application fee equivalent to each new dwellinghouse should apply to applications for each new build short term let?
Yes. It is important the local authorities are adequately resourced for this work and planning application fees are a key element of that.
Existing permitted development rights
Q.15 Do you agree with the proposed approach to the permitted development rights for dwellinghouses (Part 1) and minor operations (Part 2)?
Our concerns with permitted development rights, as set out above, remain valid. However, if they are to be used then we agree that the proposed approach is the most effective option.
Comment on the proposed planning changes
Q.16 Do you have any further comments you wish to make on the proposed planning changes in this consultation document?
It is critical that these changes are introduced alongside the statutory registration scheme being consulted on by DCMS. Experience from London has shown that the flexibility to let homes for 90 days is wholly unenforceable without the registration scheme.
Contact
Ian Leete, Senior Adviser – Culture, Tourism and Sport
Phone: 020 7664 3143
Email: [email protected]