The Incoherence Of Rentals' Control

It can appear somewhat contrary that leading hoteliers and left-wing politicians can share the same platform and, in principle, agree with each other. Such has been the result of the holiday rentals' dynamic. Two warring factions have joined forces, albeit they have become allies for different motives. The hoteliers have always had an issue with rentals because of perceived unfair competition and a lowering of standards (discuss), while the left have started to agonise over saturation and resident populations being deprived of places to live.

Exceltur, the alliance for touristic excellence, is an exclusive club. Among its members are leading hoteliers, such as Meliá. It carries a certain amount of clout. Names like Escarrer have the ears of the nation's politicians. And it was the national government which received a unified message from hoteliers and mayors when they gathered in Madrid for their forum this week. The state is the only body which can control the situation: this situation being the proliferation of rentals and the activities of Airbnb and its kind.

José Hila, Palma's mayor who is president of the federation of municipalities and provinces, underlined this message by saying that it is the state which can stand firm against these websites. The state, however, and Matilde Asián, the tourism secretary-of-state pointed this out, cannot establish a single set of regulations. The responsibilities lie with the regional governments and, up to a point, with town halls as well.

Madrid, at least while the Partido Popular remains in control of the government, seems disinclined to involve itself with market regulation. Devolved responsibilities to the regions there are, but these responsibilities produce legislation which, in the absence of umbrella state legislation, bring the regions into conflict with an arm of the national government, the competition commission. Its ultra market liberalism has been rearing its head again this week. The commission's defence of a property owner's rights has meant clashes with the governments in the Canaries and Galicia. When the Balearic government finally publishes its legislation, you can be sure that the commission will be examining the small print in great detail.

The consequence of the state's lack of involvement is legal uncertainty, something which all parties seek. A further consequence is that regional authorities can be undermined if the commission (and the courts) challenge their legislation. The Madrid government, meanwhile, will know full well that anything it might introduce would be booted upstairs to Brussels. The European Commission is lumbering towards some form of directive, though how this can possibly take into account the diversity of needs down to very local levels is impossible to understand.

Meanwhile, though, the Balearic Tax Agency and tourism ministry have been enforcing what legal powers they possess. A campaign of inspections that was carried out prior to Easter has netted eight real-estate companies in Mallorca. The fines for promoting illegal rentals will amount to some 200,000 euros. These companies are based in Palma, Arta, Capdepera, Colonia Sant Jordi and Pollensa.

Back at the Exceltur gathering, at which not all the mayors, it might be noted, were from left-wing parties, there was some consensus that there is scope for growth from rentals. Palma and Barcelona, not represented at the meeting, seem exceptions to the potential for growth rule, but for cities such as Malaga, Valencia and San Sebastian, the issues are those of diversification of the accommodation offer and of its control. It is the latter which is the key issue, but so also is enduring legal certainty. The PP in the Balearics have this week made it clear that when it returns to government - it seems confident that it will in 2019 - it will repeal the holiday rentals' legislation that Biel Barceló will shortly introduce. 

As with the incoherence caused by the state's lack of involvement, so there is incoherence at regional level. Politics change and so also do policies.