How the London Airbnb Ruling Affects Serviced Accommodation In Manchester

Introduction to serviced accommodation part 8. How the London Airbnb Ruling Affects Serviced Accommodation In Manchester

A recent ruling has placed restrictions on homeowners from renting out property through Airbnb in London. Today Rob and Paul Winder from Residential Estates discuss how this ruling might or might not affect the serviced accommodation model in Manchester or elsewhere in the UK.


Introduction To Serviced Accommodation

In Conversation With Paul Winder From Residential Estates, Chester


Rob: It’s Rob from Property Investments UK and in today’s video, we’re going to be looking at how a recent ruling in Airbnb, specifically listings in London, could impact or how it might affect other areas of the UK like Manchester.

Very recently in the UK, there was a ruling in London which ultimately impacts the allowance of short terms stays in properties around the London borough for about 90 days over a year period.

What that ultimately means is there’s a lot of people putting their properties on Airbnb that want to rent them for a night or a weekend here and there.

Over a period of time, the councils were thinking it’s limiting the amount of available housing stock for straightforward residential homeowners.

They brought in a ruling effectively which said if you want to rent over 90 days within a year period, you have to apply for planning permission to allow you to do short terms stays.

We’re having this discussion about how this might affect a couple other areas-

Paul: Yeah-

Rob: How it might affect Manchester and stuff, as well. We spoke about this briefly on another video that we’ve done on planning and what planning requirements you need for properties.

Ultimately, I guess it’s city specific, isn’t it?

Paul: Yeah-

Rob: You see things like New York. It’s happened in Berlin. ‘

It’s happened in … Where the councils, I think, so restricted on the amount of residential houses we have. We have to do something, whether it’s HMOs or whether it’s serviced accommodation.

We have to do something to allow for families to have a combination. That makes sense, but we’re not seeing anything currently in Manchester or the areas that we’re-

Paul: No-

Rob: Focusing on, are we?

Paul: No. I think one of the issues of that is the fact – relating back to a previous video – is that a lot of people are trying to do it probably when they can’t or when they shouldn’t be.

There are lots of instances where if you go through Airbnb that the owner – you have contact with the owner – they will say, “Okay, please don’t tell anyone that you’re here from Airbnb.”

Rob: Yeah, you got to come in the middle of the night.

Paul: Yeah. That’s one of the problems of doing it yourself because that does happen.

I think also from the corporate side doing it through a professional company and making sure … We’ve not seen any problems so far.

Like I say, Airbnb’s not our primary focus of where we’re looking for people.

It is one of those where you’re looking for weekend and I think some people are just thinking, “Well, okay. It’s, it’s more money. Let’s do it.”

Rob: Yeah. That’s probably the connotations from a local resident point of view is why I guess that maybe they’ve put pressure on other councils who’ve thought they need to act.

If they are seen to be bringing people in that are only going to be there for one or two nights, it might change the focus of an area. If it is a-

Paul: Of course-

Rob: House on a residential street or if it is one apartment in a block that doesn’t allow for that type of rental, then you can probably see why it causes issues.

That’s why it’s so important, I guess, from a sourcing aspect to make sure that, one, the location’s right so you’re not doing it in a town or a city that has already got those limitations in place.

Then, two, you focus on buildings like this that allow your rental model to develop-

Paul: The developer of this building, they’ve got one going on across the road and you can just imagine if that was all non-serviced and it was just being used on the weekend. That you got 300 odd flats there that can’t be used by anybody else and yet you’ve got a shortage of supply, especially when they’re being built to cater for such a shortage of supply.

That’s where the leases will come in. There will be restrictions on that, certainly in that aspect.

I totally understand it. Like I say, the amount of apartments we’re looking to put a service model on is a very, very small dip in the ocean compared to what the wider picture is-

Rob: I don’t guess it’s something that’s going to change over time. In five years time, it might be different to what it is now but what we’re seeing in terms of the market the types of properties that are available, it’s not like there are 300 apartments in this building.

Every single one’s going to be serviced, or it’s going to turn into some part hotel or something. It literally is-

Paul: Absolute, yeah.

Rob: Offering a service for companies that have a-home-from-home, effectively want those tenants to have something –

Paul: We’ve got eight in this block. We don’t offer it to anyone who’s not bought through us. It’s not one of those things we offer to everybody.

It’s just an incentive that we offer as a management company, not an incentive, wrong word, as an addition as to what we can offer for management with the well-being and the going forward from the developer.

Rob: You balance that out and make sure you’re not oversupplying in a particular development-

Paul: Absolutely-

Rob: You make sure it’s the right location, all that kind of good stuff.

Paul: Yeah.

Rob: That makes sense. I suppose from a ruling point of view, will the Airbnb ruling in London affect other areas? It may do in the future.

I certainly don’t see any kind of signs of it affecting Manchester or the areas that we focus on at the moment.

That’s why it’s so important to make sure you pick the right locations, pick the right developers, as well, so that you don’t break any of those rules and regulations when it comes to renting out and focusing on a service combination or a corporate and tenant profile, as well.

Hopefully, that helps give you context to how your properties could potentially work in those locations.

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