Simply Business - Insurance for your business

Call Us0333 0146 683
Our opening hours
Knowledge centre

Airbnb for landlords: is this a rental option?

2-minute read

Simply Business

Simply Business

26 June 2014

New plans mean that London homeowners will be able to let their properties on sites like Airbnb without fear of prosecution.

Communities secretary Eric Pickles has announced that the government will scrap legislation requiring Londoners to seek planning permission if they want to let their property for less than three months.

Under current rules Londoners who do so risk a fine of up to £20,000 – a restriction that caused particular controversy during the 2012 London Olympics.

“The internet is changing the way we work and live,” Mr Pickles said, “and the law needs to catch up” – but is Airbnb also an option for landlords?

Airbnb and landlords

Airbnb has become increasingly popular amongst homeowners who want to let their property on a short-term basis, for example while they are on holiday.

But new research from The Guardian suggests that many of the properties on the controversial site could be owned by buy-to-let landlords.

The Guardian analysed more than 13,000 London Airbnb listings, and found that 6,600 of those were for an entire property, rather than a single room. They also found more than 1,500 users of the site with listings for more than one property.

However, the legal position for landlords letting on Airbnb is complicated – and there is concern that many of those who do so may not understand their obligations.

Airbnb and buy-to-let mortgages

Most standard buy-to-let mortgages will require landlords to let their properties on an Assured Shorthold Tenancy (AST) basis. This is the standard agreement on which most properties in the UK are rented, and they normally have a term of either six or 12 months.

Buy-to-let lenders will generally explicitly forbid short-term lets on properties against which they have given a mortgage. As such, if you have a buy-to-let mortgage you will likely be breaking the terms of your agreement if you let it on a site like Airbnb.

Airbnb and insurance

Although the terms of insurance policies vary, it is important to understand that many landlord insurance policies will also require properties to be let on an AST basis, and will explicitly exclude short-term lets. If you want to let a property on a short-term arrangement, you will probably need to secure dedicated holiday let cover, but you should understand that letting your property like this will likely invalidate your landlord cover.

So is Airbnb right for landlords?

The Guardian research suggests that many landlords are advertising properties on sites like Airbnb. However, it is important that landlords understand that by doing so they may be invalidating their insurance and breaking the terms of their mortgage agreement if they have one. You should therefore treat these sites with caution, and always speak to your lender and insurer in advance.

Get set with tailored landlord cover

Over 200,000 UK landlord policies, a 9/10 customer rating and claims handled by an award-winning team. Looking to switch or start a new policy? Run a quick landlord insurance quote today.

Start your quote

We create this content for general information purposes and it should not be taken as advice. Always take professional advice. Read our full disclaimer

Find this article useful? Spread the word.


People also liked

Landlords could be targeted in new capital gains tax raid.

19 November 20202-minute read

Landlords could be targeted in new capital gains tax raid

Landlords could be hit by another massive tax raid, as the Office of Tax Simplification outlines its recommendations for an overhaul of…

Read more

Keep up to date with Simply Business. Subscribe to our monthly newsletter and follow us on social media.

Subscribe to our newsletter


Popular articlesBusiness resources from FarillioGeneral businessGuestInsuranceLandlordLandlord resources from FarillioLegal and financeMarketingNewsOpinionProperty maintenanceTradesmanCovid-19 business support hub


6th Floor99 Gresham StreetLondonEC2V 7NG

Sol House29 St Katherine's StreetNorthamptonNN1 2QZ

© Copyright 2021 Simply Business. All Rights Reserved. Simply Business is a trading name of Xbridge Limited which is authorised and regulated by the Financial Conduct Authority (Financial Services Registration No: 313348). Xbridge Limited (No: 3967717) has its registered office at 6th Floor, 99 Gresham Street, London, EC2V 7NG.