Can you run an Airbnb from a leasehold flat?

Sometimes, and the lease decides. Two clauses matter and most owners read only one. The letting clause may permit subletting with the freeholder’s consent, while a user clause requiring the flat to be used only as a private residence can prohibit short lets on its own. In Nemcova v Fairfield Rents the Upper Tribunal held exactly that, and the leaseholder was still living there.

That distinction sounds like drafting pedantry until you follow it to the end. Breach of a lease covenant is not a parking ticket. The road it runs down finishes at forfeiture, where the freeholder takes the lease back, and Parliament has laid out each step of that road in statute.

The two clauses, and why owners read the wrong one

Open the lease and almost everyone searches for the word “sublet”. They find something like “not to underlet the whole of the demised premises without the prior written consent of the Landlord”, conclude that consent is the job, and stop reading.

The clause that usually decides a short-letting question is somewhere else, in the part of the lease describing what the flat may be used for. It typically reads that the flat is to be used “as a private residence only” or “as a single private dwelling house”. It says nothing about letting at all, which is exactly why it gets skipped.

Both clauses can catch you, and they work differently.

• The letting covenant controls whether you may part with the flat, and to whom. It is about the transaction.
• The user covenant controls what the flat is used for, whoever is in it. It is about the activity.

A short-let operation can comply with the first and breach the second. That is the trap, and it is the single most useful thing to know before you read your own lease.

What the Airbnb ruling actually decided

Nemcova v Fairfield Rents Ltd reached the Upper Tribunal (Lands Chamber) in 2016 and remains the leading authority. The leaseholder held a 99-year lease and had let the flat for a run of short stays advertised on Airbnb and similar sites. The freeholder went to the tribunal for a determination that she was in breach of a covenant to use the flat only as a private residence.

The tribunal agreed. Its reasoning is what matters for anyone reading their own lease: for the flat to be used as somebody’s private residence, the occupation needs a degree of permanence that a series of short stays does not have. A guest staying a few nights is not making the flat their residence, whatever else is true.

Two details are worth holding on to, because they are the ones owners get wrong.

• She was still living there. The flat remained her own home between bookings, and she paid the bills. It made no difference.
• The lease did not need to mention short lets, Airbnb, or holidays. A perfectly ordinary residential user covenant, drafted decades before any of this existed, did the work.

The three shapes a letting clause takes

If your lease does control letting, the wording falls into one of three shapes, and they give you very different amounts of room.

The middle case is the one people misjudge in their favour. Where a lease says you need consent, section 19(1)(a) of the Landlord and Tenant Act 1927 deems the covenant to include a proviso that “such licence or consent is not to be unreasonably withheld”. That is a genuine protection. It is not permission, it does not apply where the covenant is absolute, and the same section expressly preserves the landlord’s right to “require payment of a reasonable sum in respect of any legal or other expenses incurred in connection with such licence or consent”.

And none of it touches the user covenant. Consent to underlet is not consent to change what the flat is used for.

The head lease above your lease

In many blocks there is a layer most owners never see. The freeholder grants a head lease over the whole building to an intermediate company, and the individual flat leases sit underneath it. Your lease is then an underlease: one link in a chain of titles, each carrying its own covenants, and a restriction anywhere above you can reach your flat.

That has two practical consequences.

• “My lease allows it” is only half an answer. A user or letting restriction in the head lease can bind the whole building even where your own lease is generous. Consent can be needed at more than one level, and the head lessee, often the block’s management company, is frequently the body that enforces.
• The risk scales with the size of the commitment. For one flat, a missed head-lease restriction is a painful unwind. For anyone taking several units in a block to run as serviced accommodation, it is the whole operation resting on a document nobody read before the deal.

Checking the chain is quick and it is cheap. Official copies of the registered titles come from the Land Registry, the freehold and any superior leasehold titles are listed against the building, and a property solicitor can read the whole chain in an afternoon. The question to ask, in writing: does every title above this flat permit short stays, and whose consent is needed at each level.

What breach actually leads to

Most owners imagine a fine. There is no fine. The freeholder’s remedies run toward forfeiture of the lease, and the sequence is set by statute for long leases of dwellings.

Section 168 of the Commonhold and Leasehold Reform Act 2002 is the protection that sits in the middle of that road. A landlord cannot simply serve a forfeiture notice under section 146 of the Law of Property Act 1925. First the breach must have been admitted by the leaseholder, or finally determined by the appropriate tribunal on an application under section 168(4), or determined by a court. Where it is a determination, the landlord then waits 14 days before serving the notice.

That is real protection and it is worth knowing you have it. It is also worth knowing what it is: a procedural step before the notice, and no kind of defence to the breach itself.

The practical reality is quieter than the statute. Enforcement usually begins with a neighbour who has met a different set of strangers in the lift each week and complained to the managing agent. What follows is normally a letter asking you to stop, and stopping at that point ends it. Cases reach a tribunal when somebody carries on.

The expensive way to find out

Follow the money in the order it usually gets spent. A deal is agreed, on one flat or on a floor of them. Deposits are paid and rent starts. The units are furnished from the room-by-room checklist, photographed, listed, priced and reviewed. Bookings arrive. Then the letter arrives, from the freeholder or the head lessee, and the chain of titles does what it was always going to do. Everything after the deal now runs in reverse: listings down, bookings cancelled and guests rehomed, furniture into storage or resale, and the thousands spent on setup already gone. The title check that would have prevented all of it was the cheapest item on the list, and the only one whose timing was free.

This is first-hand, and it is why we are strict about it:

I have been in serviced accommodation for a decade, and the worst losses I have seen were made before the first guest ever arrived. I have watched an operator have twenty-five units pulled after they were fully set up: furnished, listed and taking bookings. The due diligence had been skipped on the way into the deal, and every unit had to be unwound at a considerable loss. Check the chain before you spend a pound on anything that sits on top of it.

Leo Simpson, founder

Where the units are taken from their owners on company lets, the operator’s chain has the same property from the other side: whether rent to rent is safe covers that model and where its risk sits.

Forfeiture is being reformed, and is not reformed yet

One piece of context worth having, stated carefully, because it is easy to read more into it than is there.

The government published a draft Commonhold and Leasehold Reform Bill for pre-legislative scrutiny on 27 January 2026. Among other things it proposes abolishing forfeiture for long residential leases and replacing it with a statutory, court-supervised scheme. The Housing, Communities and Local Government Committee reported on the draft on 27 May 2026.

What that means today: nothing has changed. It is a draft published for scrutiny, it has not been introduced to Parliament, it is not law, and no commencement date exists for any of it. The route described above is the law as it stands, and a breach of covenant today runs down exactly that road. We review this page every 45 days and will update it when the position moves.

Asking for consent properly

Where the covenant is qualified and you want to do this lawfully, ask, and ask in a form that can be answered.

• Write to the freeholder or the managing agent, describing the actual proposal: how the flat will be let, how often, to whom, and how you will handle keys, refuse and noise.
• Expect to pay their reasonable costs. Section 19 preserves that, and a request that ignores it tends to move slowly.
• Address the neighbours’ problem. Consent decisions in blocks are made on the communal effect, so yours is the wrong place to start. Key handling, fire door propping, bin day and parties are what the decision actually turns on.
• Get the answer in writing and keep it, along with anything you were told informally. A future buyer’s solicitor will ask.
• Ask about the user covenant explicitly. A consent to underlet that says nothing about use leaves the very clause Nemcova turned on untouched.

If the lease says no

Sometimes the answer is simply that this flat cannot be short let, and it is better to hear that now than after a tribunal application.

• A deed of variation is the proper route to change the lease, and it needs the freeholder’s agreement and a solicitor. It is uncommon, and it costs.
• Doing it anyway is the option people choose most and the one worth arguing against. Beyond the forfeiture risk, an unresolved breach surfaces on the next sale, when the buyer’s solicitor raises enquiries and the answer has to be truthful.
• Longer lets are the usual lawful alternative. A letting with the permanence a residence implies sits differently under a user covenant, and it changes your legal position in other ways too: what a mid-term let does to your position works through those.
• Sell or keep it as a home. For some flats that is the answer, and a valuation that says so is more use than one that does not.

What we check before taking on a leasehold flat

This is the order we work in, and the point at which we stop.

1. The lease itself, in full. A managing agent’s summary is not the document. The user clause first, then the letting clause, then the nuisance and regulations clauses, then anything about keys, communal areas and refuse.
2. The titles above the lease. Official copies from the Land Registry for the freehold and any head lease, read against the flat lease, so the whole chain is checked and never just the bottom link.
3. The freeholder or management company’s position, in writing where it exists. Many blocks have a stated policy.
4. Any consent already given, and exactly what it covers.
5. The mortgage, because lender consent is a separate permission and a company let or short-let use is a different product question.
6. The insurance, both yours and the block’s, since what a short let needs on its policy is a different specification again.

Where the user covenant is a plain private-residence clause and there is no consent, we say so and we do not take the property on. That is not caution for its own sake. Taking it on would mean building a business on a breach that a single complaint can end.

If you want to know whether a flat works before you commit to it, get a free Airbnb valuation. Where the lease is the obstacle we will tell you, and the valuation will say so.

Frequently asked questions

Can my freeholder stop me letting on Airbnb?

If the lease gives them the ground, yes. Where a user covenant limits the flat to use as a private residence, short letting can breach it on its own, and a freeholder can apply to the tribunal for a determination of breach without needing to prove any nuisance. Where the letting covenant is qualified, they must not unreasonably withhold consent, which is a different and much weaker position for them.

What is a user covenant, and how do I find mine?

It is the clause setting out what the flat may be used for. In most residential leases it sits in the tenant’s covenants or a schedule of restrictions, and reads along the lines of using the property as a private residence only or as a single private dwelling. Search the document for “residence”, “dwelling” and “use”. Searching for “sublet” is what leads people to the wrong clause.

What happens if I have already been short letting in breach of my lease?

Stop, then take advice before you contact anyone. Most situations end with a letter and compliance, because freeholders generally want the behaviour stopped. The risks worth understanding are forfeiture, the costs of a tribunal application, and the fact that an unresolved breach has to be disclosed when you sell. A property solicitor reading your actual lease is the right next step.

Does a long-term tenant cause the same problem as short lets?

Usually not, and that is the distinction the case law draws. A tenant occupying under an ordinary residential tenancy is using the flat as their residence, with the permanence a user covenant contemplates. The letting covenant still applies, so consent may still be needed, and the lease may set a minimum term. Read both clauses, because length alone does not settle it.

Sources

• legislation.gov.uk: Landlord and Tenant Act 1927, section 19 (consent not to be unreasonably withheld where a covenant requires licence or consent, and the preserved right to reasonable expenses; checked 2026-08-17)
• legislation.gov.uk: Commonhold and Leasehold Reform Act 2002, section 168 (admission or final determination of breach required before a section 146 notice, and the 14-day wait; checked 2026-08-17)
• legislation.gov.uk: Law of Property Act 1925, section 146 (restrictions on and relief against forfeiture; checked 2026-08-17)
• GOV.UK: Draft Commonhold and Leasehold Reform Bill (published for pre-legislative scrutiny 27 January 2026, per written statement HCWS1278; the committee reported 27 May 2026; draft only, not introduced and not law; checked 2026-08-17)
• Nemcova v Fairfield Rents Ltd [2016] UKUT 303 (LC), Upper Tribunal (Lands Chamber), the leading authority on short lettings and a private residence user covenant (checked 2026-08-17)