Yes — every short-term let in Scotland has needed a licence from its local council since 1 October 2023, whether it is a whole flat on Airbnb, a spare room or a holiday cottage let a few weeks a year. Operating without one is a criminal offence with a fine of up to £2,500, and in Edinburgh a whole-property let also needs planning permission for change of use before the licence can be granted.
The detail
The scheme comes from the Civic Government (Scotland) Act 1982 (Licensing of Short-term Lets) Order 2022. Councils opened for applications on 1 October 2022; new operators have needed a licence before taking a single booking from that date, and hosts who were already trading had until 1 October 2023 to apply. There are four licence types — secondary letting (a property you do not live in), home letting (your own home while you are away), home sharing (a room while you are there) and a combined home letting and sharing licence. Investors almost always need secondary letting, which is the type councils scrutinise hardest.
The licence runs for up to three years and comes with mandatory conditions: an annual gas safety certificate, five-yearly electrical installation checks plus portable-appliance testing, smoke, heat and carbon monoxide detection, furnishings that meet the fire-safety rules, a legionella risk assessment, buildings and public liability insurance, and the licence number and EPC rating shown on every advert. Fees are set by each council and scale with the size of the property; a secondary let in a large city is typically several hundred pounds for the first licence, and a council can attach extra conditions such as a maximum occupancy.
Edinburgh is the case that decides most investment plans. The whole council area has been a short-term let control area since 5 September 2022, which means using a whole dwelling for secondary letting is a material change of use requiring planning permission — and the council refuses most applications for flats in shared stairs. Without planning consent there is no licence, and without a licence the listing is illegal. Glasgow and Fife apply the licensing rules without a control area, so the licence alone is the gate; Highland designated Badenoch and Strathspey — Aviemore, Grantown-on-Spey, Kingussie — as a control area on 4 March 2024, so a new whole-property let there needs planning permission as well.
The numbers that matter
Where this stops holding
Licensing tells you whether you can operate, not whether the numbers work — a licensed Edinburgh flat still sits in a market where the Festival month carries much of the year. Fees, processing times and the strictness of control-area planning decisions differ between the 32 councils and change with each council's policy review, so the specific council's current scheme page overrides anything general said here.
Sources
- Scottish Government — short-term lets: licensing guidance
- Licensing of Short-term Lets Order 2022, schedule 3 — mandatory licence conditions
- Highland Council — short-term let control areas
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A HostPal Invest report runs the real occupancy, nightly rate, RevPAR, regulation risk and a buy / wait / avoid verdict for one specific property or drawn area, in any of 117 markets — not a national average. Street-Level reports from £29.