Labour and Short Term Letting

I have been vocal about the need for a balanced approach to regulation in our industry. While supportive we need to ensure we are fact based over political.

I wanted to share with you a letter I have written to members of parliament representing Labour as we potentially look towards a change of Government later in the year.

Sykes Holiday Cottages is a B Corp Certified, family founded holiday let company that focuses on having a positive impact on people and planet. It now includes many local brands from similar beginnings working in communities across the UK. We have more than 60 years’ experience of the market, directly employing more than 1,200 people in the UK. On average, 40% of our owners live within 10 miles from the property they let and list an average of 1.3 properties.

It’s in that context that we care deeply about both:

Our short term let sector (which in 2021 contributed ￡27.7bn to the UK economy, 496,000 jobs – see the report we commissioned from Oxford Economics); and- ?the communities in which it operates

Housing supply concerns

Housing supply concerns There are housing supply issues in many of those communities across the UK, with many causes.

We agree with Labour that there should be an end to s21 evictions. You may have heard Tim Farron recently mention our commitment on this in Parliament.

We also agree with Labour’s plan to reinstate mandatory building targets. We believe there needs to be tough disincentives to landbanking to ensure sites with planning permission are built on. There is enough brownfield land in the UK for 1.3 million new homes and over 565,000 of these already have planning permission (CPRE). CPRE also show that for every 10 new affordable homes built, the economy will be boosted by a huge ￡1.4 million.

Councils themselves say 1,515,991 of these new homes could be delivered within five years, an uplift of 6% on current housing stock yet only 178,010 were completed across England in 2022 (Short Term Accommodation Association research from 2023).

As your Labour colleague, Siobhain McDonagh MP, said last year “I blame the Government for creating an environment where it pays to leave land empty and undeveloped.” We note the CMA are investigating the house building failure and look forward to reading their findings, due in the next month.

We agree with Labour on building more social housing for rent and ringfencing new build homes for locals and those with a local care network. They need to be affordable too (potentially through tax incentives).

There are huge numbers of un-used and under-used buildings in this country including offices, retail, warehouses and other types of accommodation where owners are looking to sell because they are becoming less popular. We believe there should be incentives to converting them to affordable homes.

Finally, there should be much greater tax rises on the 1,352,130 vacant homes in England (2021 Census analysed by ONS). We agree with the idea of your Labour colleague, Luke Pollard MP, of using such a tax rise towards “last shop in the village” funds, that would help to support the last shop in a village, the last pharmacy, the last post office, the last pub or the last bus route.

Holiday lets

There are a comparatively tiny number of short term lets (STL) in England and yet they seem to be the easy scapegoat for housing supply issues. The same ONS statistics show that compared with vacant homes there were nearly 9 x fewer whole property STLs and 2nd homes that people use themselves combined (154,970 dwellings).

There are plenty of other guestimated statistics for numbers of STL. One oft-quoted is that STLs in Cornwall have risen 661% in the five years to 2021. The vast majority of data on STLs, including this statistic, is taken by AirDNA from Airbnb and VRBO. This really shows that many of the STLs existing in Cornwall for decades have now moved to a big platform – this stat shows an exponential growth in popularity of Airbnb, rather than the sector which has grown more slowly.

Other potential issues with the stats. are:

e.g. yurts and rooms in people’s homes are quoted the same as whole property listings (significant if stating they could instead be someone’s home)

They often include old listings that have not been removed; and listings are double-counted when they appear on more than one platform. So guesstimates go up to 247,000 plus.

We support regulation of the STL sector that is proportionate and based on clear evidence. For this, the vacuum of accurate data on the sector needs to be filled before policies affecting it are developed.

STLs contribute 6x more to local economies than 2nd homes on average (source: Finest Retreats) and so it is essential that any change to how the sector operates comes from an informed position that protects local communities and continues to allow the sector to thrive.

Registration scheme

There needs to be a mandatory, national, STL register that’s online, instant and requires declaration of compliance with health and safety requirements which should be set out clearly.

It should be quick to set up and implement. We mocked up an example Gov registration page with all health and safety requirements on one page

We would be happy to discuss it with you.

It would provide authorities with awareness of how many, where and what type of STL (size, room only or whole home, primary or secondary home, all year or just a few weeks etc.) are operating. So they would be able to target their resources and local services and can conduct spot checks if they want.

It would provide consumers with assurances that they are staying in compliant accommodation.

It would drive standards by educating hosts about their existing health and safety responsibilities.

It is important that changes to how the sector operates do not have the unintended consequences of:

• Boosting numbers of empty second homes; and
• Reducing employment by damaging the ability of local economies to capitalise on the staycation boom by meeting that demand, that desire, of UK residents to holiday here and increasingly to do so in STL as opposed to other types of accommodation.

I would welcome the chance to meet with you and discuss these issues in further detail.

Graham Donoghue CEO