Self-Catering Letting Options

Holiday letting

If you let a property for holiday purposes, the law allows you to do this without the occupiers gaining any rights to stay on in the property. There is no limit to the length of the holiday let, but it must actually be for a holiday. 'Holiday letting' is defined in the Housing Act 1988 as 'a tenancy the purpose of which is to confer on the tenant the right to occupy the dwelling house for a holiday'.

You are recommended to have a basic agreement with the occupiers (this can be by letter), which includes a statement that you are letting the premises as a holiday let, with the start and end days of the let clearly stated.

If the occupier doesn't leave at the end of the let, legally you don't have to go to court to recover possession of the property. However, you would still be strongly advised to apply to the Courts for eviction.

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Out-of-season letting

If you are thinking of supplementing your income by letting your property for a number of months out of season, you can opt for:

• an assured tenancy
• an assured shorthold tenancy.

Assured tenancy

Assured tenancies are designed to give tenants the right to remain in your property until you have reason, or grounds, to seek possession. The relevant grounds in this case would be that the property has been let temporarily 'out of season' (such lets are often called 'winter lets', although they occur during any time of the year).

Setting up an assured tenancy

• The let must be for a fixed period not exceeding eight months.
• At some time in the 12 months leading up to the let, the property must have been occupied as a holiday letting.
• You must give the tenant written notice before the start of the tenancy (or include a simple declaration in the tenancy agreement) that says that the tenancy is not an assured shorthold tenancy and that possession might be recovered on the basis of Ground 3 of the Grounds for Possession in the Housing Act 1988.

Ending an assured tenancy

• The landlord has the right to seek possession of the property at the end of the fixed period of the tenancy.
• To bring the letting to an end you give the tenant two weeks' notice, using a special form, to coincide with the end of the fixed term. If the tenant does not leave at the end of the notice, you would have to start court proceedings to recover possession of the property.

Assured shorthold tenancy

A simpler form of assured tenancy that many landlords prefer to use is an assured shorthold tenancy. This allows the landlord to seek possession even when there is no specific grounds for you to do so. However, this would mean that the tenant has the right to stay in the property on this basis for a minimum of six months (even if you have agreed a fixed term for less) or the length of the fixed term, whichever is the longer.

There are no special procedures for setting up a shorthold tenancy, but the landlord must give two months' written notice to seek repossession. If the notice period expires and the tenant doesn't leave, the landlord must still recover possession through the Courts. However, for recovering possession on a 'no-ground' assured shorthold basis, the landlord can use the Accelerated Possession Procedure, which can be quicker and cheaper than a full court hearing.

Alternatively, the landlord can set up a fixed-term out-of-season assured shorthold tenancy, by prior notice to the tenant, as for a full assured tenancy.

Note!

• We recommend that you take legal advice before you enter into any tenancy agreement.
• Remember that planning restrictions may have been imposed on you as a condition of permission being granted for the property's use as a holiday property.

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Furnished holiday lettings rules

Holiday accommodation is treated in a different way to standard rental properties as far as tax is concerned. The Furnished Holiday Lettings rules apply - for more information on these rules see the Tax Status of Accommodation Businesses section.

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Further guidance

• Assured and Assured Shorthold Tenancies - A Guide for Landlords, free, Communities and Local Government Publications (see Further Information for contact details).

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