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SeveD
04-09-2008, 13:09 PM
Good afternoon everyone.

I am considering buying a leasehold property and then instead of letting it out on a AST, letting it out daily or weekly. This may sound a bit weird, but a freind of mine owns a hotel, and is often overbooked. He said that he would be able to refer people when he is overbooked. This would mean that I could take bookings on a daily basis from him. The property I am interested in one of the floors in a large house, and is a residential property.

This question is specifically about whether there are any restrictions that stop me doing this. For example :

1. Is it usual for the lease to prohibit such activity?
2. Does the local council have a probel with this?

I expect to pay for the flat using cash (no mortgage), but if I were to get a BTL mortgage, does the mortgage provider usually worry about such things?

Any advice fully appreciated.

attilathelandlord
04-09-2008, 13:30 PM
You would be running a hotel or at least B&B and would require planning permission for change of use, extensive fire safety ie the same as a hotel and the BTL co's wouldn't touch it with a barge pole.

Not to mention business rates etc. One of your neighbours would soon blab.

jeffrey
04-09-2008, 13:32 PM
Read the lease, obviously. It might well restrict use, for example, to:
a. personal occupation by leaseholder + family; or
b. not commercia/business lettings.

SeveD
04-09-2008, 13:58 PM
Thank you for your response.

attila - I thought that running a b&b did not require planning permission, but I may be wrong.

jeffrey - i would check the lease prior to any purchase, because i thought there might be restrictive covenants.

- can i ask the same question again, and this time assume it's a freehold that i buy with cash, so no mortgage company would be involved.

- from one point of view, i am simply letting out the property as any btl landlord, but for short (very) lets (i.e. days).

- i'd also like to know how holiday lets work (where these are let out weekly), and i assume that these do not need planning permission. i guess i am asking the difference between 6 month, weekly and daily lets, and why a daily let would be different, just the contract is shorter ...

mind the gap
04-09-2008, 14:10 PM
- from one point of view, i am simply letting out the property as any btl landlord, but for short (very) lets (i.e. days).

- i'd also like to know how holiday lets work (where these are let out weekly), and i assume that these do not need planning permission. i guess i am asking the difference between 6 month, weekly and daily lets, and why a daily let would be different, just the contract is shorter ...

A daily let would be different because you would have much more coming and going of lots of different people at different times of day and night, lots of different vehicles parked outside etc, etc. This may not sound like a big deal, but if I were one of your neighbours I would not be too happy. At least tenants in an AST are referenced and often become part of the community. Your guests would be there on a different basis and for different reasons and while they may contribute to the local economy a bit, they would, on balance, not contribute much socially, in fact, (some may argue), the reverse.

SeveD
04-09-2008, 14:17 PM
MTG - yes i agree with you regarding the social differences, and these have to be considered.

I was really thinking about the legal differences in respect of doing this - as I said a B&B (i think) does not need planning permission, and (i believe) people can choose to let out rooms in their house for b&b purposes as they desire, (but I may be wrong here).

Bel
04-09-2008, 14:33 PM
This sounds like a holiday let to me if the punter needs temp accomodation instead of using a hotel. I dont think hoiday let needs change of use.

If it will be your punters main home ( ie they have nowhere else to go to), then it will be an AST, which can be as short as you like, but you will not be able to evict for 6 months if they decide not to leave.

Or you will have to run it like a hostel, which will be change of use.

You should ask your local authority for advice.

jeffrey
04-09-2008, 16:58 PM
See Town and Country Planning (Use Classes) Order 2005, assuming that the property is in E&W.

'Ordinary housing is class C1.

'Hotel/boarding house/guest house' is class C3. If significant element of caring is provided too, it becomes 'Residential Institution' in class C2.

Changing from C3 to C1 use needs planning permission. It is NOT a Permitted Development Right, as defined.

SeveD
05-09-2008, 13:17 PM
hi jeffrey

i spoke with a duty planner today, and my question was thus :

if i buy a residential property and wish to let it out without any internal or external structural changes to others as a holiday let or for very short term periods would that require planning.

she said no - effectively it is being used as a home for the period of the stay. she said that unless i was changing the units to (e.g.) self contained units, or for bed and breakfast, then no planning applies.

i did specifically say that it would be let out for periods of one week or perhaps less.

i suppose that since i am not offering breakfast and the bedrooms would not be broken into self contained units, and i would not be living there (hence the b&b, guest house or hotel scenario in which owners live at the same address and offering other things like breakfast, dinner, etc.) might be the reason for their response, as i intend to let out the whole unit as it is for someone to enjoy just like a home, albeit for a short period of time.

i will investigate this still further, as it appears to be a very interesting area to explore for me, and if i get anything i'll post back. if there are any other thoughts from anyone, i'd be interested.

p.s. she did mention that for b&b, no planning is required provided the number of rooms let out meet a certain ratio of total rooms available - i guess that if you go over the ratio of rooms you intend to let to total rooms you would need planning, not vice vera (and while this isn't what i am doing, i thought it might be of interest to someone).

jeffrey
05-09-2008, 13:36 PM
hi jeffrey

i spoke with a duty planner today, and my question was thus :

if i buy a residential property and wish to let it out without any internal or external structural changes to others as a holiday let or for very short term periods would that require planning.

she said no - effectively it is being used as a home for the period of the stay. she said that unless i was changing the units to (e.g.) self contained units, or for bed and breakfast, then no planning applies.

i did specifically say that it would be let out for periods of one week or perhaps less.

i suppose that since i am not offering breakfast and the bedrooms would not be broken into self contained units, and i would not be living there (hence the b&b, guest house or hotel scenario in which owners live at the same address and offering other things like breakfast, dinner, etc.) might be the reason for their response, as i intend to let out the whole unit as it is for someone to enjoy just like a home, albeit for a short period of time.

i will investigate this still further, as it appears to be a very interesting area to explore for me, and if i get anything i'll post back. if there are any other thoughts from anyone, i'd be interested.

p.s. she did mention that for b&b, no planning is required provided the number of rooms let out meet a certain ratio of total rooms available - i guess that if you go over the ratio of rooms you intend to let to total rooms you would need planning, not vice vera (and while this isn't what i am doing, i thought it might be of interest to someone).
In your own interests, insist on the Local Planning Authority confirming (IN WRITING) that no Planning Permission is required for your property's proposed use. LPAs have been known to backtrack later on, so confirmation is essential.

SeveD
05-09-2008, 14:02 PM
hi jeffrey

i agree with your recommendation. just to put more perspecive on this, i phoned a different council to see if i received the same answer. my question this time was thus :

if i purchased a property with a view to letting it as for short periods of time, e.g. weeks, weekend or days would it require planning permission? she said it would only require planning permission if we intended to do alternations to affect the appearance - i said if i simply bought a property, did no alterations, just decorated, and let out the whole unit for short periods would it require permission? she said no.

i will phone one more council and be more specific and let you know.

SeveD
05-09-2008, 14:22 PM
last call - told them exactly what i hoped to do. the first thing they asked is whether there woud be any alterations and when i said no he said then there is no problem. i asked him to get a second opinion, and he came back to me and asked me to write in, as their office had two different opinions.

SeveD
05-09-2008, 14:37 PM
i have just done one other call - said that i wanted to purchase a flat and let it out either on an ast or short term, and particularly over the summer wanted to let it out on a daily basis. he said he doesn't see a problem, it is still residential, it's just that i have determined the frequency of how often i want to let it out. i asked whether it crossed over onto guest house, b&b, hotel regulations. he said not that he can see, but write in if i wanted written confirmation.

i think the upshot of the four calls i have made is that initially leads me to believe that this activity is ok., or if not ok, would make interesting debate if challenged. In fact the only thing that is different between what i would like to do and an ast is frequency. there is no other difference, in any other way in respect of the accommodation.

i will of course get written confirmation if i choose to go ahead.

thanks for your response.