Short-Term Rental Industry in the UK
Look at any sector in the UK today and you’ll see a pattern - technology is bringing about disruptive change... and the short-term rental industry is no exception.
Traditionally, short-term rentals were managed by letting departments of major estate agencies. Now, the sharing economy is transforming how the industry works; offering new opportunities to homeowners, property developers, and investors alike. Until recently, for the majority of property owners, the notion of letting out property short-term just wasn’t cost effective. However, with the rising popularity of online platforms such as Airbnb, flexi-lets, and Sykes Cottages, short-term rentals are becoming a viable option for property owners in highly sought after areas.
In a relatively short space of time, short-term lets have brought a boost to property stock to the rental market. A recent Residential Landlords Association (RLA) report highlighted that in London, the number of listings on Airbnb alone, had grown by 60% in just over 12 months to over 53,000 listings. That’s a whopping amount; and it’s not just individual home-owners that are getting in on the action. According to the RLA’s analysis of the secondary data, there has been a 75% growth in the number of multi-listings on Airbnb, clearly showing that a growing number of ‘portfolio-landlords’ are now shifting their business model from long-term to short-term lets as the demand for properties grow. Their survey also found that 7% of landlords are now moving properties from long-term lets to short-term lets, shaking up the property market across the country.
In an interview with the Evening Standard, London landlord Emily van Eyssem explained how she’d turned her back on the traditional buy-to-let approach and turned to Airbnb as an alternative. “It’s incredibly lucrative,” she explains. “My income has increased dramatically — for example, on a flat where I’d have been getting £1,300 per month on before costs, I’d now be making £3,000 a month.” Van Eyssem lets 10 properties in London and has had more than 500 bookings so far this year. She lets for around five to seven days at a time, and has a 98% rate of occupancy.
Admittedly, managing short-term rentals isn’t for everyone. For many property owners, especially buy-to-let landlords, long-term rentals may still offer a safer approach. Whilst landlords can charge a premium for short rentals, the hassle and maintenance associated with short-stay tenants, can prove too much for some. However, for those with property in high-demand areas, it can be a lucrative income stream.
For those working in the short-term rental industry, it’s worth noting that recent legislation changes may affect growth. In recent months, the government has set its sights on the industry, introducing new legislation. It is now illegal for landlords in the UK to let out their homes as short lets for more than 90 days a year without securing planning permission for change of use. Online platforms specialising in peer-to-peer short-term rentals will need to look at how they support legislative changes, whilst also looking after their clients. Going forward, as the number of peer-to-peer property sites grow, the battle for clients will intensify. Letting sites will need to make it as easy as possible for clients to manage their short-term rentals, and it’s likely that sites will increase their offering by focusing on bolt-on services such as maintenance, meet and greet appointments, viewings, inspections and housekeeping.
At Viewber we bring the power of the sharing economy to property professionals across the UK – including short-term rental agents. If you’d like to find out how we can help, please get in touch. We can not only help with getting people into properties at any time but have pioneered the simple and cost-effective fitting of key safes that makes the whole process much simpler.