Can I sub-let my leasehold flat on Airbnb?

Can I sub-let my leasehold flat on Airbnb? 

In short – the answer is probably no. 

Airbnb can be seen as an attractive and easy way of maximising rental income.  However, it is vital to ensure that the wording of your lease allows you to sub-let your flat on Airbnb. 

It is extremely common for leases to contain covenants restricting how and if you can sub-let your flat, such as NOT to: 

• sublet without consent of the landlord 
• cause a nuisance to other occupiers, leaseholders and/or the landlord 
• do anything to increase or render void the buildings insurance 
• use the property other than as a single private residence or as a private dwellinghouse 

In Uveta Nemcova –v- Fairfield Rents Limited [2016] UKUT 3030 (LC) and Bermondsey Exchange Freeholders Limited –v- Ninos Koumetto (as Trustee in Bankruptcy of Kevin Geoghehan Conway) it was considered that to be a “private residence” there needs to be a 

“degree of permanence going beyond being there for a weekend or a few nights a week” 

and that  

“there is a qualitative difference between letting a property on an assured shorthold basis to a person or family who occupies the same property as their home, and letting the property on a short term let including through Airbnb and other websites” 

These cases have made it clear that short-term subletting on Airbnb is not use as a “private dwellinghouse” or “private residence” and doing so is probably a breach of your lease. 

The consequences of breaching your lease can be serious and ultimately may result in you losing your home. 

Aside from your lease, other matters to bear in mind are planning law, insurance, health and safety issues, taxation and your mortgage conditions. 

Airbnb started in 2008 with two flatmates renting out their spare room for some extra cash but, with over ¼ of listings being by hosts with more than 5 sites, it is now a mainstream business for many people.  There are increasing calls for regulation by way of mandatory registration, limits on the number of days properties can be sub-let and reducing the “Rent a Room Scheme” tax-free threshold. 

With an apparent legal and regulatory clampdown on Airbnb it will be interesting to see where its future lies in the housing market.   

Expert advice from Rebecca Turnbull-Simpson, Interim Head of Dispute Resolution at Coole Bevis LLP