Short-term lets – licensing scheme and planning control areas: business and regulatory impact assessment

J: Consumer Assessment

119. The Scottish Government definition of a consumer is "anyone who buys goods or digital content, or uses goods or services either in the private or public sector, now or in the future".

120. In the context of short-term lets, the consumer is primarily the guest. However, hosts may also be consumers of services provided by platforms, letting agents and hosting intermediaries.

121. In terms of the consumer assessment questions:

Does the policy affect the quality, availability or price of any goods or services in a market? Yes.

Does the policy affect the essential services market, such as energy or water? No.

Does the policy involve storage or increased use of consumer data? No, in respect of the primary consumer; there is not change to the way guests’ data is stored. However, yes, in respect of hosts’ data as local authorities will be using and storing more information about them.

Does the policy increase opportunities for unscrupulous suppliers to target consumers? No.

Does the policy impact the information available to consumers on either goods or services, or their rights in relation to these? Yes.

Does the policy affect routes for consumers to seek advice or raise complaints on consumer issues? Yes.

122. The legislation primarily regulates the provision of short-term lets by the host to guests. The legislation has the effect of strengthening the position of the guest in terms of assuring them that their accommodation meets basic safety standards. The legislation makes it easier for guests or neighbours to raise concerns about a short-term let with the host, or the relevant local authority, should that be necessary. This is of particular benefit to more vulnerable guests or neighbours who may have been reluctant to raise concerns in the past.

123. These short-term lets are more commonly provided for leisure purposes but can include stays for work. As we are not regulating access to an only or principal home, this is not an essential services market.

124. The legislation provides increased protection for guests (as well as neighbours and communities). Hosts seeking to ensure compliance with the mandatory conditions will need to be wary of unscrupulous suppliers selling assessments (e.g. fire risk or legionella) that are not valid or overpriced. We will be setting out in guidance for hosts and platforms how they can avoid this. For example, some assessments are relatively straightforward for hosts to complete themselves.

125. The Licensing Order will result in local authorities retaining more data on short-term let hosts and making more of this publicly available. The handling of data is covered in more detail in the Data Protection Impact Assessment. But it will be possible for short-term let accommodation to be identified from the register and for that address to targeted for marketing purposes.

126. Local authorities will recoup the cost of operating the licensing scheme through fees charged to hosts. Some of this cost may get passed on to guests through higher costs for booking the accommodation. The overall effect is that guests should pay for and receive, and be assured of, a higher quality (safer) service, although hosts may absorb some of the cost.

127. The availability of short-term let accommodation may be reduced in some areas either where margins were already very tight or where the local authority makes this a deliberate policy but see paragraph 117 above.

128. The licensing scheme will affect terms and conditions for bookings. Clearly, a host will not be able to provide booked accommodation if the booking is for a period after which the licence application is refused or the licence suspended or revoked.