New Holiday Let Regulation Is Imperative

Last year I was involved in a public debate about holiday rental accommodation in the Balearics which, to be perfectly honest, was a bit of a waste of time. The intention had been good but the debate, such as it was, became mired in the sterility of law and took too little account of what should be central to such a debate - tourism and tourists.

The law is of course hugely important, but it is the law - different regulations, contradictions the law permits, its lack of clarity - which is at fault. It's small wonder that any debate is reduced to dissecting points of law, because - and despite the claims of the tourism ministry and some lawyers to the contrary - the law is not well enough understood, while it is also open to wholesale abuse.

A debate held last week featured professors from the university; the vice-president of the Mallorcan hoteliers' federation, Inma de Benito; the tourism minister, Jaime Martínez; the tourism minister in Catalonia, Marian Muro; the president of Fevitur (Federación de Asociaciones de Viviendas y Apartamentos Turísticos), Pablo Zubicary. It was really no different to previous debates. Law, law, law.

It should now be obvious that laws in the Balearics which apply to holiday rental accommodation are inadequate. One of these laws, the Ley de Arrendamientos Urbanos (often referred to as the Tenancy Act), creates as much abuse as the prohibition on apartment rental specified in the tourism law. The unreal nature of this law and of the principle of "family and friends" being able to occupy holiday accommodation (which shouldn't be defined as such) has led, as an example, to the situation in Sóller which was reported last week. Well over a thousand places (i.e. beds) are offered and taken up by visitors who are anything but family and friends.

The obfuscation that applies to holiday rentals has long been, one feels, something that has suited the regional government. Martínez, recently given a ticking-off by the Chamber of Commerce and told to make things clearer, attempted to do so (or claimed that he was), but failed. Quite deliberately, one fancies. Keep things opaque, the market will be confused, the government can act against owners if it so wishes, and the hoteliers will be happy.

At the debate last week, Martínez and de Benito were in the minority. The professors, Muro and Zubicary represented the pragmatic and common-sense side of the debate. Muro's presence was perhaps the most important, as her government in Catalonia has adopted regulations which have been acting as a type of benchmark for other regions to follow. It is permissive while at the same strict in applying standards and demanding proper registration of all types of property. Also last week, we learned that the Canaries, where there has been resistance against holiday lets of a similar level to that in the Balearics, were moving to regulate. Those islands may not adopt the same system as Catalonia, but it was revealing that Catalonia's model was referred to in despatches.

The development which more than any has made it imperative that there is some form of pragmatic regulation that is more permissive and is very much clearer is the P2P phenomenon. It has undoubtedly given rise to far more property coming onto the market via the internet, much of it unregulated and illegal. So, faced with the additional dynamic that P2P brings, what does the regional government do? Draw up a black list of all websites that may be offering unregistered properties. What it doesn't do is move towards a sensible form of regulation, thus reinforcing prohibition which leads, as all prohibition does, to an ever-expanding black market.

De Benito's presence at that debate was also important. She is likely to become the new president of the hoteliers' federation and she has been the principal source of anti-holiday rental propaganda that has been emanating from the federation. However, both she and Martínez must know that things could change. If the Partido Popular is ousted from the regional government in May, which in all likelihood it will be, the new government will be dominated by PSOE, recent converts to the pro-holiday rental lobby, and the two other parties which will matter, Més and Podemos, neither of them allies of big business and so therefore the hoteliers.

Because of this potential change in government and governmental policy, de Benito's role is now more significant than that of Martínez. She will hope to get PSOE onside, but she's battling against a tide of sensible regulation adopted elsewhere. The need for proper and clear regulation, one that establishes standards, correct registration, transparent marketing and also safeguards for owners, both those who rent out and those who don't, is indisputable. Obfuscation will no longer do, unless the government wishes to expand the black market.