Four Grand To Make Holiday Rentals Legal

The Balearic government, working on the reform of tourism law legislation that will regulate (make legal) some accommodation for holiday rental that is currently not legal, has a plan that could see it bringing in getting on for 200 million euros.

To give some background to this, it may be recalled that the government was, until recently, benefiting from a system whereby hotels paid to regularise places that did not have legal status. Reasons why they didn't have this status were principally due to the fact that rooms had at one time been used for non-guest purposes, such as use by staff, as utility rooms or for other purposes. They were subsequently converted but left in a state of regulatory limbo.

When this system was introduced, there was a figure of some 53,000 such places throughout the Balearics, an enormous number when one thinks about it. The decree that enabled the system was extendable only once, and the final deadline for this expired in January this year.

Although the system worked reasonably well in that the fee required to regularise these places went into a fund for resort infrastructure regeneration, it didn't work anything as well as it might have done. Roughly one tenth of these places were regularised and paid for. There remain around 48,000.

You may well of course ask how the hotels can get away with this. You may ask, but getting an adequate answer would be another matter. In theory, all these places are now not being occupied, though theory and practice are two entirely different things. It is, though, the very existence of this stock of places which is one reason why the government is not minded to allow new places to be created. If hotels want to build new places, then they have to close others down.

Anyway, the government has been considering these 48,000 places in a different light. Why not have a stock of holiday rental places equivalent to this number? Moreover, why not have owners of properties who wish to legally market their properties - apartments, for instance - pay an equivalent amount as the hotels were paying to regularise their places? Four thousand euros per place.

It is said, and you can of course never be certain of these figures, that there are 100,000 places of a holiday rental nature on the margins of legality, a polite way of saying that they are in fact illegal. The government views such a number with a degree of horror: they would be far too many. Forty-eight thousand, however, might well be acceptable.

The problem that the government will have, though, is that whatever it does in terms of legislation, there will still be owners who simply refuse to abide by the rules. Catalonia's experience is just that, and it hasn't asked for the sort of money to regularise properties that Biel Barceló and his ministry have in mind. There is also the fact that some owners might only want to rent out accommodation now and then. Asking them for four thousand sounds rather excessive. That would then leave the owners who only wish to ever rent out and to do so all above board. They would pay four thousand euros, need to meet minimum standards of quality and service but find that there are plenty of others flouting the regulations.

There again, the government is also planning on introducing what it dubs an "express" system of fining owners who bend the rules. The tourism ministry says that there isn't a problem with the number of inspectors but with the bureaucracy that surrounds the processing of penalties. It is going to simplify the process therefore.

Well, it may be simplified but one suspects that there is an issue with the number of inspectors. As for the 48,000 places at 4,000 a pop, one struggles with the logic, but then legislation regarding holiday rentals has long defied logic.

A further element of the planned legislation relates to the potential for communities to veto permissions for individual owners to rent out touristically in apartment blocks. But the word from the ministry this week has been that it doubts if this - a community veto - would stand up legally.