Edinburgh's short term let scheme ruled unlawful
Lord Baird ruled parts of the short term let policy is unlawful at common law
Last updated 8th Jun 2023
A licensing scheme for short-term lets in Edinburgh has been ruled to be unlawful by a judge.
The aim of the scheme was to crack down on AirBNB style properties which the Council deemed to be unsuitable for certain areas of the city, and to open up more of the Capital's housing stock to locals.
It would mean hosts of properties would have to apply for permission to continue to let out their properties on a short-term basis, facing tough criteria to do so.
Campaigners against the move have long claimed it was a de-facto ban on short-term lets and would damage a key component of the city's economy.
But operators launched a legal challenge to the policy, raising £300,000 via a crowdfunder - the largest amount ever crowd funded for a legal challenge in Scotland - claiming the policy went beyond limits set by the Government.
A main sticking point for the policy was writing which stated “secondary letting in tenement or shared main door accommodation is considered as unsuitable” and the burden would be on the applicant to demonstrate why they should be exempt from the rule.
Lord Braid ruled that a ‘rebuttable presumption’ against granting licenses for secondary lets – an entire property that is not an operator’s principal home – within tenement blocks was unlawful.
Holiday letting operators were required to submit an application to be permitted to continue to operate by October 1st.
A statement issued by petitioners said: “We have yet to fully digest the detail of the decision but we hope that this will give common cause to both the Scottish Government and City of Edinburgh Council to seek a fresh approach that aims to collaborate and work with local operators of self-catering accommodation, recognising the many good things it brings to the economy and people of Scotland.
“As the largest crowd funded case in the history of the UK, the petitioner team are deeply grateful to the many small, local businesses that supported the campaign financially in such uncertain times. That grass roots support made it possible for us to take this action, challenging both licensing and planning surrounding short term lets in Edinburgh and the potential wider impact across urban and rural Scotland. “
But campaigners on the other side of this debate say the ruling shows that operators can "use their money and power to weaponise the legal system to their advantage."
Eilidh Keay from tenants’ union Living Rent Edinbrugh said:
“This flies completely in the face of democracy and the will of the people.
“Edinburgh needs homes, not holiday lets. In coming down in support of short term let operators, this decision seems to have forgotten that Edinburgh is in the midst of a housing crisis.
“It is disgusting that the profit of short term let operators should be put before the needs of tenants, residents and communities for homes.”
Fiona Campbell, chief executive of of the Association of Scotland’s Self-Caterers, said: “We are pleased this decision from the Court of Session confirms that City of Edinburgh Council’s short-term let licensing policy was unlawful in respect of the rebuttal presumption and contravenes Provision of Services Regulations.
“We pay tribute to the determination and courage of the four petitioners, and are extremely thankful to all those who donated and the superb legal team. This was a team effort and they can be incredibly proud of what they achieved.
“The impact of this will not be confined to the capital as the decision has ramifications for licensing schemes across Scotland.
“The Scottish Government need to go back to the drawing board on short term let regulation and engage constructively with industry to provide a regulatory framework that works for all stakeholders.
“The time to act is now and the ASSC has pragmatic, fair and proportionate policy solutions which can assist.”
Council Leader Cammy Day said: “I’ve received today’s judgement and am pleased that we’ve been successful in defending large parts of our policy.
“While I’m obviously disappointed that the court didn’t find in favour of our policy on secondary lets, I make absolutely no apology for seeking to protect our residents.
“It’s no secret that we face unique housing pressures here in Edinburgh, with a small but densely populated city centre and fast growing population, and it's crucial for us to strike the right balance between promoting our visitor economy while looking after the people that live here all year round.
“Our residents have told us that, in many cases, STLs are hollowing out their communities, reducing housing supply and increasing housing costs. We can’t forget that many have endured years of disturbance and anti-social behaviour and we will continue to work hard to get this right.
“The court acknowledged our intention to find a solution to this and agreed that it was legitimate to use both planning and licensing policy. We welcome the clarity provided and will now consider our next steps in more detail.
“We remain committed to ensuring the whole city benefits from our thriving visitor economy but it has to be managed and it has to be sustainable – and I continue to believe that fair and effective STL controls would be an important step in the right direction.”