Ashley Richmond, director at Modo Property, has a number of apartments in Central Manchester that are let out as serviced accommodation (SA). I start by asking if he has noticed an increase in BTL landlords switching to SA. He replies: “Since we’ve been involved in SA we have seen a rise in the competitiveness and volume of units on the marketplace and we’re seeing more and more houses just outside the city centre which seem to be doing better than city centre apartments.
“I find it very difficult to compare traditional BTL with SA though. BTL is definitely a property investment strategy (it can become a business when scaled) whereas SA is always a business, it’s all about providing a service. We predominantly rely on online travel agents for our bookings (predominantly booking.com) however we have had a large number of bookings through our free google business page.”
What are your thoughts on Oxford City Council recently calling for SA landlords to apply for planning permission? “This maybe a contentious opinion but I believe this could benefit the sector. We are ourselves active in Manchester City Centre and Manchester City Council is already looking at restrictions on short-term lets for new buildings/areas where they grant planning permission.”
Regarding this subject, Manchester City Council stated: “Well-managed short-term lets in appropriate areas of the city can be positive when they offer tourists or business travellers an alternative option for accommodation. However, it is recognised that poorly managed properties can negatively impact the host community.
“The City Council is now using Brunswick as the blueprint to ensure family homes in similar key regeneration areas are not lost to the investor market or short-term lets, helping to protect and build a long-term community of people. To ensure these homes remain in the hands of Manchester residents, strict covenants are in place that prevent properties being sold to private landlords who would likely turn the properties into short-term lets or make available as student homes (Houses of Multiple Occupation), given the close proximity to the city’s universities.”
I ask Ashley if he thinks there is a chance that restricting short-term lets could become national policy. “I believe Edinburgh and Dublin already have restrictions. But to my knowledge the entire countries of Wales, Ireland, Republic of Ireland or Scotland do not. Obviously short term lets in London are already restricted by the 90-day rule, although it doesn’t seem to be policed much (that I’m aware of, although I’m not active in London and have little interest). However, I do believe that a nationwide policy for short-term lets/SA will come into place in the form of a planning class in the not too distant future (2-3 years).”