Parts of Edinburgh Council’s short-term let licensing policy are ‘unfair’ and ‘illogical’, judge rules

Lord Braid also took issue with the council’s STL application form

Parts of the City of Edinburgh Council’s short-term let licensing policy are “unfair” and “illogical”, a judge has ruled, in a decision which could affect attempts to regulate Airbnb-style properties.

A short-term let operator and a property management company sought a judicial review following the council’s designation of the city as a “control area” for that type of property.

At issue was whether the regulations had retrospective effect on properties which had changed to become a short-term let before the new rules came into effect on September 5, 2022.

Parts of the City of Edinburgh Council’s short-term let licensing policy are “unfair” and “illogical”, a judge has ruled, in a decision which could affect attempts to regulate Airbnb-style properties.

In a ruling released on Friday, Lord Braid found in favour of the two petitioners, rejecting the council’s interpretation of the relevant planning legislation.

It is the second time a court has ruled against Edinburgh’s short-term let (STL) licensing scheme this year, with an earlier ruling from Lord Braid saying parts of the policy were “unlawful”.

In the most recent judgment, Lord Braid also took issue with the council’s STL application form, saying it “actively discourages” anyone from applying who does not have planning permission or an application in the pipeline, despite this not being required in every case.

Rejecting the council’s arguments, the Court of Session judge considered a hypothetical case of two STL operators – one of which had a certificate of lawful use before September 5, 2022 and the other who did not.

Lord Braid said: “The respondent (Edinburgh council) would have it that the operator with a certificate of lawful use need not apply for planning permission, perhaps recognising that to hold otherwise would be to affect retrospectively the acquired rights of the operator in question; whereas the other operator would be bound to do so.

“That is not only unfair, but illogical.”

Fiona Campbell, chief executive of the Association of Scotland’s Self-Caterers (ASSC), hailed the judgment and said it will have implications beyond Edinburgh.

She said: “The ASSC welcomes this judgment from Lord Braid which not only has profound implications for Edinburgh, but short-term let policy across Scotland.

“We pay tribute to the perseverance and determination of the two petitioners, Iain Muirhead and Louise Dickins, who have borne huge personal and financial costs once again.

“This grassroots action was not undertaken lightly, and they took the courageous decision to bring this action against Edinburgh council to protect not only their businesses, but also an industry that is critical to both the capital’s economy and the entire tourism sector.”

The council was given powers to designate the whole city as a short-term let control area by the Scottish Government.

It came after concern about the growth of STL properties in the city and their impact on local residents.

A Scottish Government spokesperson said: “The introduction of licensing safeguards the role short-term let accommodation plays in our economy by providing assurance to guests on safety and quality, such as gas certificate compliance and suitability of electrical equipment.

“Licensing authorities have 12 months to process applications for existing hosts and are working with operators to progress their application.

“Existing hosts can continue to trade and welcome guests whilst their application is being considered, the scheme remains open for new applications.”

James Dalgleish, planning convener for the City of Edinburgh Council, said the local authority is now considering its next steps.

He said: “We introduced the STL control area to help us manage the number and location of STLs across the city.

“We continue to face uniquely difficult housing pressures. with a small but densely populated city centre and fast growing population across the city as a whole.

“We have to strike the right balance between promoting our visitor economy while looking after our residents who live here all year round and, having just announced a housing emergency, it’s more important than ever that we find ways of bringing homes back into residential use.

“It’s important to point out that, following today’s ruling, residential properties that began being used as STLs after the control area came into force on September 5, 2022 still require planning permission.

“Those that began before that date may still need it and will be considered on a case-by-case basis.”