Short Term Rentals – 5 Common Pitfalls

Property management of a rental property

Short term rentals are certainly in demand with stays ranging from a few weeks to six months, with London having restrictions on the number of nights offered.

The higher rental prices bring benefits for both the tenant (flexibility) and the landlord (extra revenue) but there are drawbacks too, below we outline the 5 most common pitfalls in offering short term rentals.

Cottage in the country offered as a short term rentals
Higher rents may initially attract you to offering short term rentals however, be prepared to put in extra effort and accept greater risk.

1) Infrequent tenants mean extra costs

Not only do you have to kit out the property fully furnished for your next tenant, but those extra allowances such as a 10% charge built in for wear and tear no longer becomes applicable.

Instead, higher rents can be expected and although this has a benefit, if upkeep of the property is required more often ultimately you’re out of pocket.

2) Short term rentals subject to planning permission

In general planning terms, ‘planning permission’ must be obtained if there is any ‘material’ change of use to a property or building. In most cases, it is relatively straightforward as to what constitutes a material change of use (e.g. converting a house into a commercial building or a block of flats). However, in some cases it is a matter of judgement on the basis of fact and degree.

For example, at what point does a residential house become premises whose main purpose is to offer accommodation for visitors?  This issue is particularly relevant for bed and breakfast properties where the property is simultaneously a residential property and a commercial property.

Before the Deregulation Act 2015 came into force, planning permission was needed for every short-term let of a property in London.

However, the Deregulation Act 2015 amended the legislation and the short-term letting of a residential house or flat is now permitted as long as the total number of nights does not exceed 90 in a single calendar year and at least one of the persons providing the short term rental is liable to pay Council Tax.

The Government’s commitment is to long-term secure housing, so they don’t always look favourably at short term rentals.

3) Additional agent expense

Should you choose to offer your property as a short term rental through a high street management agency, you will most likely be charged extra simply because the effort in finding frequent tenants is greater and the day-to-day management is more intense.

If you are looking to manage the property yourself and simply need the exposure to find a tenant, you could advertise your short term rentals on sites like

4) Mortgage / Lender restrictions on short term rentals

Sometimes terms and conditions in freehold leases and mortgages could put a stop to the idea of a short-term let. It’s worth checking your personal details before you make a decision to change the type of letting, which could forfeit a mortgage in the worst case scenario.

5) Short term rentals and void periods

And finally the unspeakable of the short term rentals market, void periods. Because as much as we would like one tenant to move out on one day and another move in the next, that’s not always the way it works. With the additional responsibility of finding tenants at short notice, an empty property becomes problematic and less secure.

These are just 5 pitfalls you can face from letting on the short-term market, so it’s no wonder that a majority of landlords are preferring letting long-term.

Warton Farm Cottages, short term rentals in Thropton
This landlord converted her short term rentals in Thropton into 12 month minimum rentals.

Anne is just one of our landlords rethinking their short term rentals strategy.  She says;

“For years I had run three successful short term rentals, and although the volume of weekly changeovers was intense, it was a pleasure to meet guests and ensure that every element of their stay was enjoyable. Importantly, however, it meant that I could command a better yield with stays of one and two weeks with no void periods.

“The changing habits of holidaymakers happened gradually, with fewer people wanting to commit to booking in advance and more requesting accommodation with just a few days’ notice.

“Fast forward a few more years and with regular requests for such items as a coffee-making machine, a constant supply of logs for the log burner and a 14 tog duvet, I decided to re-think my short term rentals business and instead hand over the responsibility of obtaining such luxury items, as well as the general upkeep of the property, to my guests on a longer-term basis via online letting agent”

With help available and better agency rates for landlords to set up a long-term let, you can see why most opt for the security of a long-term let – and if you require flexibility, you can always opt to end the tenancy agreement early with a break clause.

See also: how to attract long term tenants

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