Housing: Rental Market

Viscount Younger of Leckie Excerpts

Monday 28th October 2019 Lords Chamber

[Baroness Gardner of Parkes (Con)]

My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I declare my interests as set out in the register. The Question is appropriate given that it follows the last one on a similar issue.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government and Wales Office (Viscount Younger of Leckie) (Con)]

My Lords, the Government have no current proposals to regulate short-term platforms. We welcome the efforts of the Short Term Accommodation Association to improve standards. With the support of my department, the Minister for tourism will soon host a round table on short-term lets with senior industry stakeholders. Short-term lets account for a fraction of the dwelling stock in England and there is little evidence to suggest that the availability of housing for rent has been adversely affected.

[Baroness Gardner of Parkes]

I thank the Minister for that Answer, but I believe that it would be desirable to reintroduce licensing rights for local authorities so that they have powers in this area. The whole of London has recently been damaged by the fact that there are no arrangements whatever for rubbish to be put out. On the day people leave such lettings, they just dump their rubbish outside the property. The Government’s response has been that local authorities are entitled to collect a special amount in this respect, but there is no one at the property from whom to collect the money because they have already gone. I ask the Minister to look seriously at ensuring that local authorities are now given more control, as they had before they were lost in the 2015 Act, over licensing and inspection, and in particular to check whether owners have the legal right to let their property.

[Viscount Younger of Leckie]

On the subject of possible registration, we welcome Airbnb’s plans to hold a national discussion on this matter and we are engaging with it and other similar stakeholders on their proposals. Perhaps I may say that local authorities already have powers to take action against issues such as noise, anti-social behaviour or the accumulation of rubbish, as my noble friend has pointed out, that may arise in relation to short-term properties. I would urge anyone with such a complaint to take it to their local authority. We want to encourage responsible short-term letting where hosts behave in accordance with the law and with respect for both their guests’ safety and their neighbours’ peace.

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, I refer the House to my relevant interests. Is the noble Viscount saying that he does not accept that there is a problem here which needs to be dealt with?

[Viscount Younger of Leckie]

No, I am not saying that there is no problem. We take the view that we welcome the voluntary approach. We are encouraging the Short Term Accommodation Association to drive up standards. Its self-regulatory measures to date include the Safe, Clean and Legal accreditation scheme in partnership with Quality in Tourism, its collaboration with Westminster City Council to develop and promote the considerate short-term lets charter and its members’ voluntary imposition of checks to help enforce the 90-day limit in London only.

[Lord Bird (CB)]

If thousands of houses are taken out of the housing market in London, does the Minister not agree that that would have an effect on the price of rents and on homelessness?

[Viscount Younger of Leckie]

I said in my initial Answer that the increase in Airbnb lettings is not having an effect on houses to rent. But on the noble Lord’s point about prices paid by rental tenants in the UK, prices rose by only 1.3% in the 12 months to September 2019, a rate unchanged since May 2019.

[Lord Palmer of Childs Hill (LD)]

My Lords, the Minister replied very blithely to the question asked by the noble Lord, Lord Bird, but Airbnb has become very profitable. Does the noble Viscount not agree that there has been a big decrease in properties for long-term rent and purchase, despite the percentages in his answer, and that the vast increase in short lets is not how to build communities?

[Viscount Younger of Leckie]

I can only quote the figures that I have given noble Lords, which show that there is an increase but it is not having an impact on private rented property. As I said, we want to continue to follow the advocation for self-regulation and to support local authorities. In 2018, the Short Term Accommodation Association implemented the considerate nightly letting charter with Westminster City Council. With the fines that have been imposed—I have the details of those—it seems to be working. As I said, we are determined to follow the voluntary approach at present.

[Lord Whitty (Lab)]

My Lords, a few months ago, I asked Ministers what they were doing about the situation where leaseholders and tenants of social housing were subletting to Airbnb and equivalent bodies, and the Minister indicated that it was not their problem but it was local authorities’ problem. I now ask about an issue that clearly is central Government’s problem: how many of the 80,000 odd premises that are let to Airbnb in London are registered for business rates, business for profit tax or VAT, because this form of tourism is detrimental to a lot of areas in central London where people live and where housing is in very short supply?

[Viscount Younger of Leckie]

As I said earlier, we think it is right that local authorities remain responsible for this area. Westminster City Council has investigated or is in the process of investigating over 1,500 properties for unlawful short-term letting. In one case earlier this year, a fine of over £100,000 was imposed. But the noble Lord is right that those who let out their properties for Airbnb must pay taxes. That is something that local authorities should look at. Of course, when they register, local authorities can find out who the hosts are and whether taxes have been paid or not.

[Lord Best (CB)]

My Lords, the Government decided, very wisely, to establish a regulator for property agents—for estate agents, letting agents and managing agents of leasehold property—but have decided at the moment not to include in that the organisations that provide these very short-term lets such as the Airbnbs of this world. In view of the misgivings that abound about Airbnb and others and the campaigning work of the noble Baroness, Lady Gardner of Parkes, over so many years, might it not be a good idea for the regulator’s remit to include these organisations as well?

[Viscount Younger of Leckie]

We welcome the report by the working group on regulation of property agents chaired by the noble Lord. It was published in July this year and extends to some 24,000 words, with 53 recommendations. Since then, I reassure the noble Lord and the House that officials have begun an extensive programme of evidence-gathering with over 30 interviews with key stakeholders either already or soon to be conducted. That will form the careful consideration that we will give to the point he raised. While we are open to following the evidence, it is not government policy to support regulation of short-term lets at this time.

[Baroness Bennett of Manor Castle (GP)]

My Lords, the Minister may not be aware—the discussion thus far has focused on London—that in York the number of Airbnb and HomeAway listings is growing at 12% per quarter, not per year. Since 2016, there has been a 300% increase in the number of entire homes advertised in York. The Minister referred to councils acting on the law. Will he consider how councils can be assisted with laws and regulations and resources to enforce the 90-day change-of-use rule?

[Viscount Younger of Leckie]

The 90-day change-of-rule applies to London alone. York is a wonderful place to go, and it is a good thing that Airbnb operates there because short-term lets allow households to boost their income, which in turn promotes economic growth through tourism, although I agree that a balance has to be struck with impinging on the business of local hotels. Hull, which is not too far from York, appreciates having extra accommodation during peak times. During its year as City of Culture it ran an initiative with Airbnb called “Everyone Back to Ours” to help attract more people to the city, so there is a balance to be struck.