Can a tenant let out a property on Airbnb? Property Disputes specialist, Mike Hansom, explains the law.
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For a business founded less than 15 years ago, Airbnb has proved an incredible success. The latest figures reveal that the company:
- has over 4 million hosts and more than 6 million listings.
- operates in 191 countries.
- has more than 150 million users who have booked over 1 billion stays.
- has a share of more than 20% of the holiday rental market.
Indeed, on average, six users check into an Airbnb listing every second.
Why host on Airbnb?
Airbnb offers an affordable alternative to hotels, particularly in tourist hotspots. And this potential to generate additional income is not lost on homeowners or tenants. A great example is London, where, as of November 2022, there were 69,351 Airbnb listings. But what are the risks?
The risks of Airbnb hosting
Unfortunately, entrepreneurial property owners or tenants often face legal obstacles.
Hosting on Airbnb means that tenants are very likely to be in breach of their tenancy agreement as it’s unlikely their landlord will have consented to sublet. Landlords tend to view subletting as unjust enrichment by the tenant. And even in the unlikely event of receiving consent, a landlord risks breaching the terms of their head lease if the property is leasehold.
Furthermore, an Airbnb listing can:
- breach restrictive covenants. This is particularly common in flats where it’s often felt that short-term holiday lets have a detrimental effect on security, levels of nuisance and community feel.
- breach planning law and planning permission.
- invalidate insurance policies.
- breach the terms of a mortgage lender’s consent to rent the property.
Tenant hosting on Airbnb: what should the landlord do?
In the first instance, a landlord should speak to the tenant, draw the breach to their attention and ask them to remove the listing. In many cases, tenants are unaware they are in breach of their tenancy agreement and will comply.
Should a polite approach prove unsuccessful, the landlord may consider serving a Section 21 notice to evict the tenant. However, please note that the Section 21 procedure will likely be abolished shortly when the Renters Reform Bill becomes law.
Alternatively, a landlord may consider serving a Section 8 notice on discretionary grounds, particularly:
- Ground 12 for breach of the contract.
- Ground 14 can be used if the comings and goings and other activities of the Airbnb guests have caused a nuisance to neighbouring properties.
Should the Section 8 proceedings proceed to court, evidence is crucial as the claim is on discretionary grounds. From the outset, a landlord should always approach a breach of a tenancy agreement on a worst-case scenario basis, ie that court proceedings will be necessary. Not doing so may compromise evidence gathering.
Take screenshots of the Airbnb listing, the reviews and details of the host as soon as the situation comes to your attention. Remember, someone other than the tenant may be representing themselves as the host.
Ask neighbours for witness statements. Occasionally, flats have a concierge service, and their evidence can prove valuable. Flats also sometimes have CCTV in the communal areas. If so, ask the management company for a copy of the footage covering any relevant period.
Essentially, the more evidence a landlord produces, the better the prospect of the court’s decision going their way.
In a sobering warning for council tenants, in 2019, Westminster City Council fined a tenant £100,000 and evicted them for hosting their property on Airbnb.