AirBnB’s ‘problem’ in excluding residents from the housing market in the city of Somerset
The AirBnB explosion has revolutionized travel for many, providing the opportunity to ‘live like a locals’ while staying in anything from a lavish mansion to an elegantly furnished bedroom in a guest’s home.
Yet the so-called “AirBnB effect” has also seen several local housing markets contract as more and more people advertise their properties as short-term rentals.
Nowhere is the flourishing of AirBnB properties in Somerset more evident than in the pastoral gem of Bruton.
Read more: The restaurant that the Portuguese community travels across Somerset to visit
There are around 35 AirBnB properties on offer in Bruton through the rental company’s website – in a city experiencing huge demand for housing, which has shown no signs of slowing down.
With a direct train connection to London, Bruton is perfectly located for a weekend getaway and with the prestigious prints of the Hauser & Wirth Gallery as well as popular restaurant such as At The Chapel, there is plenty to do for the ICES. tourists in it.
The city’s healthy tourism sector is certainly “very good from the customers’ point of view,” said Bruton Parish Council President, and is indeed energized by those who have decided to convert their individual or annex rooms to Holiday rents.
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However, Parish President Ewan Jones said housing shortage issues arise when entire homes or apartments are marketed as AirBnB, as opposed to long-term rentals.
The city council’s survey of the 2017 master plan found that residents expressed a need for two- or three-bedroom homes or small apartments for rent, Jones said.
He continued, “AirBnB is definitely a problem when it takes that part of the market out, so there are no opportunities for local people to find a place to live.
“When we talk to the bigger companies in the Bruton area, they say their number one problem is finding affordable places for their workers because they have to live some distance and travel.”
He noted that many workers based in Bruton are forced to live in Wincanton, Frome or Yeovil, where there is more housing available and they are in a price range.
Mr Jones said: “If people are using these properties it is great because they are spending money in local stores.
“What concerns me is that we are running out of places for people who work here and around. They would also spend money in local stores.
Landlords are not required to apply to council for a change-of-use authorization before putting houses on short-term rental, which Mr Jones says could personally provide the solution to the problem, although the council does not. has no policy on this yet.
Mr Jones said: “If you have a standalone unit that you are going to use as AirBnB, in my opinion you should need a scheduling app to change its use, as we would if a store is to be converted to house, for example.
“We want to find all possible means to provide the small family houses and apartments that people tell us they need in Bruton.”
Earlier this year, Edinburgh became the first UK city to ask AirBnB hosts to apply for a building permit in an attempt to quell the housing shortage after the city center was reportedly ‘gutted’ by short-term rental properties .
The financial impact
Local authorities are losing millions of pounds in municipal tax revenue because the current system of commercial rates allows many vacation home owners to avoid paying the tax, as long as their properties are available for rent.
Mr Jones confirmed that the rise of AirBnB “potentially” puts pressure on board revenues, when they are “short of funds anyway.”
Owners of second homes in England who plan to rent out their property on a seasonal basis more than 140 days a year pay professional rates, thus exempting them from council tax.
Yet there is currently no requirement for proof that the house is rented, nor any government checks.
Additionally, there are 21,312 vacation rentals in the South West on the business rate list that are eligible for “small business rate relief” – meaning they pay nothing at all – according to the figures of Colliers.
Colliers estimated that if these properties paid local taxes, local councils in Somerset, Cornwall, Devon and Dorset would benefit from £ 35.5million in revenue per year.
John Webber, Head of Corporate Tariffs at Colliers, said: “Given the pressure on local government finances, we find it incongruous that this loophole has not been closed and it is unfair that the local tax burden continues to rise. weigh on local residents or other types of businesses. who are struggling to pay their bills.
“We want to make it clear that we are not blaming homeowners who take advantage of this tax break by making their properties available for rent – this could be seen as sound tax planning.
“However, we blame the government for seeing too much of this mess which inevitably leads to friction.
“The fact that this tendency to switch from the housing tax to the professional rate is increasing every year is also a real source of concern.
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