Before you start to Airbnb or short let your London property, there are many things to think about, so we’ve compiled a short guide of key considerations before you start. If you are in doubt about any of these rules, it’s important that you seek advice and approval from your mortgage provider, financial consultant, solicitor and local council.
OBEYING THE 90 DAY RULE
Regulations were introduced in Greater London in 1973 to restrict the use of residential premises as temporary sleeping accommodation. In 2015, an act was passed that relaxed these restrictions following the rise in popularity of sites such as Airbnb. This enabled homeowners in London to short let their properties for a maximum of 90 days in a calendar year without the need for planning permission
Some property management companies will automatically limit your calendar to this 90 day period. However, if your property is listed on multiple platforms, the responsibility is with you, the homeowner, to ensure you don’t exceed the 90-day limit.
If you are renting out your spare room or the whole property, you can earn up to £7,500 on a tax-free basis, providing that the property is your main residence and it is fully furnished for your guests. This is allowed under the Government scheme, Rent A Room.
If your rental income is higher than £7,500 annually through short letting your home, you will need to complete a tax return and pay tax on the additional amount.
If you are unsure about tax, you should seek advice from an accountant, who can inform you of the tax implications relative to your personal circumstances.
ENSURE YOUR PROPERTY IS COMPLIANT
To ensure that your guests have an enjoyable and safe stay in your property, it’s important that you have completed all your safety checks. Most checks are required on a regular basis and are either local or national safety regulations.
Here are some of the safety checks to carry out before you short let your property. Please note: this is not an exhaustive list and extra research may be required
For a landlord, gas safety should be at the top of the priority list. Ensure all your gas equipment is safely installed and maintained by a Gas Safe registered engineer. Landlords have a duty to ensure annual gas safety checks are carried out across the whole property.
ENERGY PERFORMANCE CERTIFICATE
Landlords are required to obtain and provide an EPC report. This report shows you how energy efficient your property is, rating the property from A to G. A rating of ‘A’ is preferable, meaning your property is working efficiently and should help you in reducing your monthly running costs.
ELECTRICAL SAFETY TESTS
Ensure all electrics in the property are in working order, including all sockets, light fittings, kettles, microwaves, ovens etc, by employing a qualified electrician to perform an electrical report, named an EICR. A standard EICR is valid for 5 years, but it is often advised to check electrical safety more frequently.
So, short letting is a great way to make some additional income, especially in today’s competitive and growing market. But often, short letting can be stressful to hosts, with a growing and relentless to-do list – everything from photography, listing, bookings, guest enquiries, personal check in’s, housekeeping, cleaning and maintenance.
This is where City Relay can help. We are proud to be London’s most trusted property management company, offering an all-in-one service to our hosts. Find out more about our services or complete our rent estimation tool, to find out how much you could be earning from your property.