knowledge | 19 June 2019 |
Government to Regulate “Short-Term Letting” in Rent Pressure Zones from 1 July 2019
Any short-term lease or licence of residential property in a rent pressure zone will shortly be deemed a material change of use and so require planning permission. There will be limited exemptions for home-sharing of your principal private residence. The new rules are introduced by s38 of the Residential Tenancies (Amendment) Act 2019 as supplemented by the Planning and Development Act 2000 (Exempted Development) (No. 2) Regulations 2019 and are expected to come into effect on 1 July 2019.
1. Why and where will the rules apply?
The new rules are aimed at addressing the perceived negative impact of “holiday lets” on the availability in the ordinary private rental market of houses and apartments for rent. As this is most critically felt in areas where there is a high demand for housing, the rules will solely apply to areas designated as “Rent Pressure Zones” (“RPZs”) under the Residential Tenancies Acts.1 The RPZs include Dublin, Galway and Cork.
2. What types of arrangements are affected by the new rules?
The new rules apply to “short–term lettings”, which are leases or licences of all or part of any house or apartment for 14 days or less. From 1 July 2019, such a short-term letting within an RPZ will be deemed a material change of use that, unless exempt, will require planning permission.
3. What types of arrangements are not affected by the new rules?
Leases or licences (including rent–a–room schemes and corporate lets) for periods longer than 14 days are not affected. Leases or licences of homes that already have a specific grant of permission in place for use as holiday accommodation or short-term tourist or other visitor accommodation are not affected. While individual planning permissions should be checked, purpose built student accommodation should not be affected as summer letting to tourist or visitors is often allowed by those kinds of planning permissions.
4. What exemptions are there?
The following short–term lettings in RPZs are exempted:
- short-term letting of a person's principal private residence provided no more than 4 bedrooms are let, to no more than 4 people per bedroom (this has been explained as covering home-sharing where the owner remains resident, but, strictly, the exemption is not so limited); and
- short-term letting of the entire of a person's principal private residence (ie with the owner being absent) limited to 90 days per calendar year.
The exemption will be lost if short-term letting is expressly prohibited by any existing planning permission in place for the house or apartment or is inconsistent with the permitted use.
Anyone relying on the exemption must notify and give special details to the planning authority.
There is no exemption for short-term letting of a non-principal private residence; accidental and professional landlords will require planning permission before short-term letting.
5. Who is responsible for enforcement and are there penalties for non-compliance?
The enforcement unit of each planning authority will be responsible for monitoring and enforcing the requirements in their respective functional areas. Non-compliance will carry a maximum penalty of €5,000 or 6 months imprisonment or both. Where a person continues the offence after conviction, they will be guilty of a further offence for each day the offence continues, with the offence carrying a maximum fine of €1,500.
6. Is there any control outside the RPZs?
The new legislation only regulates activity within the RPZs. Short-term lettings outside the RPZs might still require permission. In 2016, An Bord Pleanála determined that year-round short-term letting requires planning permission, where the owner is not also present. Although that decision was made in connection with a site in Dublin, the Department of Housing, Planning and Local Government alerted all planning authorities to the need to apply the decision nationwide.
Should you have any queries on short–term lettings please contact Brendan Slattery or Shane Sweeney, or your usual contact in McCann FitzGerald.
- For a full list of areas designated as RPZs, see here. Current designations have been recently extended so that all current designations will remain in place until the end of 2021.
This document has been prepared by McCann FitzGerald LLP for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.