Edinburgh short term lets: Council's bid to regulate Airbnb-style accommodation ruled 'unlawful' by judge

Short term let owners have won their battle against Edinburgh council’s bid to regulate Airbnb-style accommodation in the city, after a judge ruled some aspects were unlawful.

Four operators brought action against the authority on the grounds that new rules amounted to a ‘de-facto ban’ on short term lets and would wipe out livelihoods while damaging the city’s economy. The owners, who raised more than £300,000 to bring the challenge, said they faced the threat of “extermination” under new rules being applied retrospectively across the whole of Edinburgh amid claims that ‘reasonable’ operators were being rejected in their license applications.

The new scheme would require hosts to apply for a licence by October. Those who list entire properties on Airbnb and similar sites also need to planning permission or a ‘certificate of lawfulness’ if their property has been used as an short term let for more than ten years. Under the rules, the council said a let in a tenement building wouldn’t be granted a license unless it had ‘good reason’.

The group called this a "rebuttable presumption" against granting licences for secondary lets in tenements. This means the onus is placed on the landlord to show why their application should still be granted, notwithstanding the policy. Morag Ross KC argued for the group that the presumption against granting licences for properties in tenements was "perverse" and tantamount to “unequal treatment” of hosts who use second homes as short-term lets.

Edinburgh council defended its rules and told the Court of Session that they met “the test of lawfulness”. But Lord Braid agreed with petitioners Ralph Averbuch, Glenn Ford, Louise Brook and Craig Douglas, and concluded that the presumption was unlawful. He stated that the rules around the presumption are "irrational, since they do not support the statutory purpose of the licensing regime. As such, they are unlawful".

He said a ‘blanket approach’ based upon the type of property, or the area in which it is situated would ‘go beyond the scope of the licensing regime’. In the judgement issued on Thursday, he wrote: “It is not the function of the respondent’s licensing authority to decide that a licence should not be granted because a property is of a particular type or is in a particular area.”

He also said the policy around renewal applications, required to be made annually, was unlawful and breached existing legislation called the Provision of Services Regulations 2009.

Petitioner Ralph Averbuch said: “Winning is just a waypoint in a much longer battle for reasonable and fair treatment of the self-catering sector. We never wanted a fight. We were never against some form of licensing. But when it's weaponised to try to take out a whole sector of local small businesses it became clear we were fighting for our livelihoods, our very right to exist.”

Lawyers for the group said they didn't oppose regulation but launched the legal challenge to ‘protect against bad practice’. The Association of Scotland’s Self-Caterers hailed the ruling as a ‘victory for law and common sense’.

City of Edinburgh council leader Cammy Day said: "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. 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 short term lets controls would be an important step in the right direction."

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