Edinburgh will become Scotland's first designated Short-Term Let Control Area after the Scottish Government approved the City of Edinburgh Council's proposed change to planning requirements.

The control area is intended to preserve the character of neighbourhoods, prevent short-term lets in inappropriate places or types of building, and help ensure homes are used to their best effect. With a few exceptions, changing the use of an entire residential home in the city to short-term letting will automatically require planning permission.

Housing Secretary Shona Robison said: "Edinburgh was the first local authority in Scotland to propose a Short-Term Let Control Area and Scottish Government approval represents a major step forward. We have committed to give local authorities the powers to address concerns about the impact of commercial short-term letting in their communities, should they want to do that. This is an example of that local choice in action – supported by the majority of respondents to the council's consultation on the proposed designation.

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"I recognise the important role which short-term lets play as a source of flexible and responsive accommodation for tourists and workers, which brings many benefits to hosts, visitors and our economy. However, we know that in certain areas, particularly tourist hot spots, high numbers of lets can cause problems for neighbours and make it harder for people to find homes to live in.

"The Scottish Government considers that the council has adequately considered and responded to concerns raised before seeking approval of the control area designation. We have concluded that the proposed designation would be reasonable."

City of Edinburgh Council Leader Cammy Day said: "This is the news we have been waiting for after leading the way in campaigning for change. I am delighted that Ministers have answered our calls and we look forward to reviewing the full details included in the decision released today.

"It paves the way for Edinburgh becoming the first short-term let control area in Scotland. For far too long, too many homes have been lost in our city to the holiday market. In fact, around a third of all short term lets in Scotland are here in the Capital, so their associated issues of safety, anti-social behaviour and noise have a detrimental effect on many of our residents. We will now progress implementing the changes and the next step should be looking at whether we can apply a cap on numbers, too."