Around 450 operators were questioned by the trade body in an online survey this month as it continues to gather evidence around the impact of STL regulations.

A new licensing scheme for short-term let hosts opened in October 2022. It gives councils flexibility to develop licensing schemes that meet local needs, and sits alongside powers for councils to establish short-term let control areas.

To comply with the licence, hosts are required to meet a set of mandatory conditions which apply across Scotland, plus any additional conditions set by their council.

Around one in ten (11%) respondents said they had experienced no mental health issues as a consequence of regulatory changes. This figure drops to 0% in Edinburgh where the most stringent STL controls can be found.

The City of Edinburgh Council’s new licensing scheme also includes additional controls for short-term lets for properties used as secondary letting within a tenement or shared main door property. The capital’s scheme allows the authority to restrict tenements and shared door properties being used, and ensure that correct planning permission and safety checks are in place.

The overwhelming sentiment is that the regulations have created financial strain, as well as increased anxiety and uncertainty, with sectoral discontent also clear.

In terms of the key findings:

• Across Scotland, over two-thirds (68%) had either experienced a ‘negative’ or ‘extremely negative’ impact on their mental health and wellbeing from recent regulatory changes;
• This was particularly acute in Edinburgh where around 90% of operators had seen a negative or extremely negative impact;
• Edinburgh also had the highest number of extremely negative responses (46%);
• Nearly two-thirds (63%) of operators in the Highlands saw their mental health impacted; and
• The equivalent figures for those in Perth and Kinross was 56% and in Argyll and Bute it was 72%.

The professional and personal strain is taking its toll. Several respondents highlighted the emotional toll, such as sleeplessness, anxiety, stress-related health issues, and feelings of helplessness, especially with the uncertainty of future income and business viability. Many respondents also mentioned the high cost of compliance, administrative burdens, and delays in licensing applications, particularly for those relying on self-catering as their primary income.

The findings come as BiGGAR Economics published its independent analysis of the sector in Edinburgh which showed it generated £154 million in GVA and supported 5,580 jobs in 2023, while only having a negligible impact on housing with empty homes far outstripping the numbers of STLs.

The ASSC said the industry has attempted to work with national and local government to address the outstanding challenges to the regulatory framework but often to no avail. The organisation has offered short-term let recommendations to policymakers as far back as 2019 to strike the right balance and protect Scotland’s self-catering industry and the thousands of jobs it supports in local communities.

Fiona Campbell, CEO of the Association of Scotland’s Self-Caterers, said: “Running a small business can be a rewarding experience but the last few years have been gruelling with the pandemic and cost of living crisis bearing down on everyone.

“What is causing particular anguish is the ominous threat that livelihoods will be snatched away due to heavy-handed government regulation, especially with the conflation of licensing and planning requirements.

“Our survey highlights widespread concern amongst Scotland’s self-catering sector, with a clear negative impact on mental health due to recent regulatory changes. Well-managed short-term lets can easily coexist within communities while contributing meaningfully to local employment and the economy.

“It has to be remembered that the very same individuals under the cosh have dedicated their working lives to ensuring Scotland remains a welcoming and leading destination. Quite frankly, they deserve much better.”