Published on: 20th December 2016
London has a very sensible rule for homeowners who want to make a little extra cash by renting out their flats or houses when they’re away: you can let your home for up to 90 days per year under the London legislation introduced in 2015.
This strikes the right balance between burdensome red tape and distorting the housing market. The short-term letting of homes for up to 90 nights in a calendar year, introduced in 2015, means Londoners could earn up to £4.5bn, given that 600,000 properties sit empty for four or more weeks a year.
Given the financial constraints of the past decade, this is a significant boost to wallets, purses, and London’s economy as a whole. A homeowner can expect to earn a few thousand pounds extra a year by doing little more than letting tourists or business travellers sleep in a comfy home rather than a drab or very expensive hotel (and the first thousand pounds are tax free).
But it is also right to set a limit. No Londoner wants to see house prices spiral even further out of control by creating a buy-to-let market that services only tourists and rich business folk.
Without the limit, unregistered hotels and professional landlords could let their rooms and homes only to travellers all year, reducing housing stock and driving up rental prices for those who live and work in our great city.
What Veeve wants to see is the rule properly enforced. It has been reported that some companies have the bulk of their listings available all year round and that isn’t in line with the letter or the spirit of the law.
This is why we have signed up to the TrustSeal to help self-regulate what has come to be known as the ‘Sharing Economy’. This sees owners rent out things they are not using – from cars to cameras – or use their spare time to play host to, for example, a dog while someone is away, or clean a flat.
But this is a young industry that is growing from infant into spotty teenager. To mature, we need to set and meet higher standards.
In our sub-sector of the market, we have created a premium service where the homeowner can go away and feel secure their property is protected while we let it out. We carefully select the guests, personally check-in and out all stays, provide fresh towels and linens for each stay and a professional clean before the homeowner returns, and unlike many companies we provide insurance to cover all stays, providing peace of mind.
Just as importantly, we support the 90-day rule. This is important for us as an industry, to avoid the situation where there would be calls for reduced limits or even bans, or resulting in market distorting crackdowns that have occurred in Berlin and Barcelona.
This industry has great government support, a strong legislative environment and the 1000 GBP sharing economy tax break. We can build on that by further supporting the TrustSeal and encouraging all the industry’s leaders sign up to it. This kite mark assures customers who are naturally wary of using this new-fangled sharing economy that we get the basics right, from pre-vetting guests to clear pricing and refunds.
By setting these standards, we can help people use their assets to the maximum potential and give customers a wider choice of goods and services. PricewaterhouseCoopers has found that the UK has become a hub for this emerging sharing economy, with £7.5bn of transactions last year alone.
But to fulfil our potential, we must all take responsibility for gaining your trust.
