Updates to licensing give short-term lets more flexibility

Following the introduction of a licensing scheme in October 2022, the Scottish Government has been monitoring the impact of the legislation on consumers and the sector. Engagement with accommodation operators has resulted in improvements which allow the transfer of licences, more exemptions, and provisional licences for new properties. MSPs approved these measures on 26 June 2024.

Edinburgh Castle above rooftops of old stone townhouses on a cloudy day

Housing Minister Paul McLennan stated that the Scottish Government recognises short-term lets are a vital part of Scotland’s economy, and they have listened to the industry on the importance of enabling the sector to thrive while being compliant with regulation.

Transfer of licences

Before this change, if a property sold, the existing licence would cease, and the new owner would be required to make a new application. By enabling the transfer of short-term let licences, short-term let properties can now be sold with a licence in place, allowing the buyer to continue operating it without unnecessary delays.

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Provisional licences

This amendment introduces the option for operators constructing buildings for short-term let use, to apply for a provisional licence that can be confirmed once the premises are complete. This aims to support the financial lending approval process and speed up the granting of a full licence once the property is complete and meets the required standards. 

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Local authorities will then have the option to allow temporary exemptions to the requirement to obtain a licence, for example during major sporting events or festivals.

Someone wishing to let a property during these periods still needs to apply to the council and pay a fee but does not have to complete a full licence application. HMOs rented out for short-term lets still require the short-term lets licence, even if they have an HMO licence.

Previously, hosts could only apply once per year, but that has now been increased to a maximum of three licence exemptions totalling six weeks in a calendar year.

Propertymark’s position

We remain supportive of the aims of the licensing scheme, to ensure all short-term lets are safe, to facilitate licensing authorities in knowing and understanding what is happening in their area to assist with handling complaints and address issues faced by neighbours effectively.