Central Government calls meeting with all regions of Spain to address holiday homes

  • Canarian Weekly
  • 22-05-2024
  • National
  • Photo Credit: Europa Press
Central Government calls meeting with all regions of Spain to address holiday homes

The Ministry of Housing has summoned all regional governments for a sectoral conference this Friday morning to address the issue of holiday lets and tourist rental apartments. This will be the first sectoral meeting focused exclusively on this growing problem, according to sources from the department headed by Isabel Rodríguez.

Minister Rodríguez has expressed support for limiting holiday rental licences in high-demand areas while respecting regional competencies. She recently announced her intention to meet with the regional governments, alongside the Minister of Industry and Tourism, Jordi Hereu, to discuss the issue, which is straining the residential housing market.

"I do not want to encroach on their competencies, but this is my concern because it is straining the residential market and the right to access affordable housing," Rodríguez stated in a recent interview.

The Ministry aims to regulate the sector with a "scalpel" approach, considering territorial diversity. In this context, the government is paying attention to EU directives, as the European Court of Justice has acknowledged the need to address this issue and opened the possibility for market intervention.

While acknowledging that the rise in holiday and seasonal rentals is reducing residential housing availability in major cities and tourist areas, the Bank of Spain cautions against imposing limitations without considering their economic impact. The bank estimates a deficit of 600,000 new homes needed in Spain by 2027 to meet expected demand.

Exceltur (the Alliance for Tourism Excellence) reports a significant surge in tourist apartments at the beginning of the year, with an increase of 60,000 units (25.2%) in the 25 main cities in Spain, totalling 285,266. Madrid and Barcelona lead with 59,111 (29.8%) and 41,681 (11.8%) respectively, followed by Málaga with 32,468 (29.9%).

Canary Islands Prepare New Legislation

In the Canary Islands, the regional government is preparing a law on holiday rentals. Presented in early April, the draft does not include incentives for owners to convert tourist properties to residential use, nor does it create teams to monitor the irregular market or impose exclusive taxes on owners.

The draft law delegates most regulatory responsibilities to municipalities, which must set a maximum number of licenses so that tourist apartments do not exceed 10% of the total municipal building capacity.

However, some areas already exceed 20%, and many zones do not reach the 10% threshold, not accounting for people renting them illegally, which would significantly increase numbers in many areas of the islands.

Since the announcement of this draft law, applications for new holiday homes have surged from about 50 daily to over 70, a 40% increase. Consequently, political parties and unions have called for a moratorium on license issuance until the law takes effect, a proposal rejected by the regional government, which denies any "pull effect." Regional President Fernando Clavijo has stated that municipalities can impose a moratorium at their discretion.