Shocking report reveals rapid growth of Airbnb-dominated short-lets sector
Published today by ARLA Propertymark, the report predicts that up to half a million rental homes could be taken out of the traditional sector as landlords tire of increasing regulations and taxes.
ARLA Propertymark has published shocking research into the Airbnb dominated short-lets sector that reveals 46,000 rental properties have already been lost from the traditional long-term sector, a figure that could eventually rise to almost 500,000.
The trade association has also launched an eight-point plan (see link below) to create a level playing field between the traditional and Airbnb-dominated short-lets sectors.
ARLA’s report reveals that although only 2.7% of landlords have transferred their properties to Airbnb and other short-lets platforms so far, the data points to a rapidly accelerating trend.
Completed in partnership with research consultancy Capital Economics, it predicts that, eventually, between 230,000 and 470,000 properties could transfer from long to short-term in the coming.
The number of active listings on Airbnb in the UK increased by a third to 223,000 in 2018 from 168,000 in 2017.
Among landlords who have already moved over, two-fifths said they had switched to short-lets to avoid burdensome regulation of the traditional private rented market.
London has the largest market in the UK, with the number of active listings rising four-fold from 18,000 in 2015 to 77,000 last year.
“As landlords are continuously faced with increased levels of legislation, it’s no surprise they are considering short-term lets as a chance to escape this,” says David Cox, Chief Executive of ARLA Propertymark (left).
“Unless the sector is made more attractive, landlords will continue to exit the market resulting in less available properties and increased rent costs.”
Download ARLA’s eight-point plan.
Industry reaction
David Alexander, boss of lettings platform apropos by DJ Alexander
“It is clear that Airbnb and other holiday lettings outlets are attracting a lot of negative publicity due to their enormous expansion over a relatively short period.
“They undoubtedly provide a service but the light touch regulation which they have enjoyed to date is unfair to existing landlords and property providers.”
David Smith, Policy Director for the Residential Landlords Association
“Today’s report highlights how inconsistent the Government’s approach to the rental market now is.
“On the one hand the Ministry of Housing wants to encourage more landlords to offer properties to tenants on a long-term basis.
“On the other hand the Treasury has a tax system which makes renting out holiday homes more appealing at a time when demand for homes to rent is outstripping supply.”
David Alexander who I spoke to and then saw in action at the Neg Conference just before Christmas is a very wise and deeply committed property professional who knows his industry backwards.
I think he is being very kind when he uses the term light touch and regulation, regarding Airbnb, as it seems political expediency and financial interests are shutting down the debate for the time being.
As an ex-landlord, which began in the late 1980’s and having divested myself of all property that tenants can live in, many ask me why I am not in the rental game.
Well, although most landlords have only one or two properties, the hoops that you have to jump through, the excessive stamp duty and the ever increasing, and mostly essential, red tape would I think take two days a month out of my working life.
And for what? A minimal return, there are better ways of investing money. Yes, you can go all in and do the rental thing on an industrial scale, this still leaves you open to risk.
For the past decade, the direction of travel has been, institutional players with pension funds buying build to rent new accommodation from house builders. This is the government’s thinking.
No surprise then Airbnb with its soft or zero level of regulation and more transitory type of ‘day-tripper’ tenant is becoming ever appealling.
I wonder if it’s a coincidence that the Govt. have been hitting private landlords again and again with increased taxes and regulations in a bid to pave the the way for large Build To Let companies with deep pockets?