Pitfalls of the Gig Economy – The Temptation of Airbnb


Gary Leverett
Gary Leverett
Associate Solicitor

Airbnb, the darlings of the so-called Gig Economy, offer many homeowners a tempting opportunity to earn a little extra cash by making use of that spare room or even the use of your home as a short term holiday let.

However, many potential owners are putting themselves into a precarious legal trap following the recent case in the Upper Tribunal, and you may find yourself in breach of the terms of your lease.

Understand the Terms of Your Lease

It is common for many long residential leases to have clauses in the following or similar forms:

  1. “Not to assign, underlet or part with possession of part only of the demise premises.

  2. “Not to use the demise premises for any purpose whatsoever other than as a private residence / single private dwelling / other than a private dwelling in occupation by one family only.”

If you were just letting that spare room, you could be in breach of the first clause and if you were letting the entire property as a holiday let you could be in breach of the second clause.

If your lease contains a clause that you could only use the premises for the occupation of one family only, then this would also be a breach of the second clause. 

The Ruling

According to the recent case of Nemcova v Fairfield Rents Ltd [2016] UKUT303, the Upper Tribunal rejected Miss Nemcova’s submission that a short term let of a flat (through Airbnb) is still being let as a private residence. 

The Upper Tribunal held that in order for a property to be used as the occupier’s private residence, there must be a degree of permanence going beyond being there for a weekend or a few nights in the week. 

People who would be occupying the flat on a short term letting would not be occupying it as their home and therefore, Miss Nemcova was in breach of the terms of the lease because she was using the flat for a purpose other than used as a private residence.

The landlord in these cases can prohibit such lets by making an application to the county court or the First Tier Tribunal.  If such lets continue, you could, ultimately, in a very worse case scenario, have your flat forfeited by your landlord and thus losing a most valuable asset.  

Seek Professional Advice Before You Let

At MW, our expert property dispute solicitors can help you to examine and understand your lease.  We strongly advise that you seek the advice of one of our solicitors who will help you to  avoid the pitfalls of such lettings.  Make an appointment to check that your plans do not amount to a breach of the terms of your lease.  Timely advice at an early stage can avoid expensive litigation further down the line.

If you would like to talk to one of our Property Disputes Team, call us today on 020 3551 8500 or email us at enquiries@mwsolicitors.co.uk

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