Airbnb has called on banks and building societies to update rigid mortgage policies that prevent borrowers from occasionally sharing their property on platforms like Airbnb to boost their income.
According to new research released by the firm, over three quarters of homeowners (77%) are thinking about ways to supplement their income to combat the rise in mortgage rates.
Nearly half of homeowners (47%) would list their home on a short term lettings platform in order to cover the increase in monthly payments, but 40% of borrowers say their mortgage provider won’t allow them to rent out their home or spare room on Airbnb.
Metro Bank and Barclays are two lenders that allow borrowers to share their space on platforms like Airbnb for up to 90 nights a year but other key lenders either forbid home sharing, only allow it for second homes and buy-to-let properties or fail to offer clarity about which type of activity is allowed.
The Government’s Rent a Room scheme allows homeowners to earn £7,500 of rent tax-free each year by taking in a lodger yet Airbnb claims there is lack of clarity for homeowners about whether their mortgage provider allows this activity and in which scenarios. Some lenders require that borrowers file paperwork with a fee to secure permission and in only specific circumstances, such as if they are in the Armed Forces and currently serving away from home.
Over a third of UK Hosts say they use the income from Airbnb to afford the rising cost of living. The vast majority of UK Hosts on Airbnb share just one listing, often their main home, with the typical Host earning just over £6,000 a year – equivalent to two months additional pay for the median UK household.
Bim Afolami MP, Chair of the All Party Parliamentary Group on Financial Markets and Services, said: “Allowing homeowners the flexibility to occasionally let out their property as a means of earning some extra income is a clear win for mortgage providers and could provide an important lifeline to those who might be struggling in these difficult economic times. Banks and building societies can follow the example of of lenders who are offering flexibility to their customers and allowing them to take up the benefits of homesharing.”
Amanda Cupples, general manager for Northern Europe at Airbnb, added: “With mortgage rates and inflation continuing to climb in the UK, British families are turning to hosting on Airbnb as a tool to afford rising living costs. In normal times, this activity, which for most Hosts would be for no more than a couple days a month, offers flexibility and a source of additional income but in the current climate, it could be a lifeline. We want to work with lenders and show them the benefits of home sharing so they can update their policies and let homeowners make their homes work for them.”
