Planning Permission for Luxury Holiday Lets: Important Changes

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Proposed New Use Class for Holiday Lets in England

In recent years, the exponential growth of short-term holiday accommodation—spurred by platforms such as Airbnb—has led the UK Government to revisit how these properties are treated within the planning system. In response, a new planning use class, known as Class C5, has been proposed in England. This change aims to give local authorities greater control over the proliferation of holiday lets, particularly in areas facing housing shortages or unsustainable tourist pressure.

Under current legislation, most short-term let-downs fall within Class C3 (dwelling houses), which is the same category as ordinary residential homes. Introducing Class C5 would allow local authorities to distinguish between permanent residences and properties used for short-term holiday letting. This shift could mean that converting a property from a standard dwelling (C3) to a holiday let (C5) would require planning permission—depending on how local planning authorities choose to apply these new powers.

At the time of writing, the current Labour government has not yet actioned this policy, but consultation documents are in circulation, and implementation is widely anticipated in the near term.

A Professional Perspective

At Markos Design Workshop, we welcome this increased clarity. The short-term letting market is, in many areas, operating in a regulatory grey zone, with numerous properties used as holiday accommodation without proper planning consent or consideration for community impact.

While some councils support holiday lets as part of a local economic strategy—seeing them as a way to boost tourism and support independent businesses—others have adopted more restrictive positions in their Local Plans, particularly in high-demand areas where housing stock is under pressure.

In our view, these changes represent a necessary step towards professionalising the holiday rental sector. A well-regulated system creates confidence for all parties involved—owners, neighbours, guests, and the wider community. It also provides a more predictable planning landscape for those looking to invest responsibly in this space.

A Note on Article 4 Directions

Even before the introduction of the proposed C5 use class, some local authorities in England have already used Article 4 Directions to restrict the proliferation of short-term holiday lets. An Article 4 Direction removes permitted development rights in specific areas—meaning that even changes currently allowed without planning permission, such as switching from a residential home (Class C3) to a short-term let, would require formal planning consent.

These powers are typically used in areas facing acute housing pressures, or where the balance between permanent residents and holiday accommodation is seen as unsustainable. In practice, this means that councils can—and in some cases already do—require planning permission for holiday lets, regardless of the broader national policy.

Key Considerations

• Class C5 (Proposed): A new planning use class for short-term lets.

• Planning Permission: May be required to convert between C3 and C5, subject to local policy.

• Permitted Development Rights: Local authorities can remove these via Article 4 Directions.

• Professional Standards: Increased regulation encourages accountability and quality in the sector.

Thinking About a Holiday Let?

If you're considering a luxury holiday home—either as a private retreat or an income-generating asset—now may be a particularly opportune time to explore your options. With the planning framework evolving in a more structured and transparent direction, it is vital to align your plans with local policy from the outset.

We offer tailored feasibility studies and pre-design advice for holiday homes and cabins, combining architectural vision with practical insight into planning strategy and return on investment. Feel free to get in touch to see how we can support your next project.