Saturday, August 05, 2017

The Impact Of Rentals' Legislation On Pollensa

The Council of Mallorca has a plan for intervention in tourist areas. The acronym is PIAT. This plan forms the basis of decisions to be made on the allocation of zones for additional tourist places under the recent holiday rentals' legislation.

Included in this plan is a map of what is described as the "non-regulated offer" of places for tourist stays. There are certain hotspots, varying shades of orange and red showing areas with the highest number of non-regulated (aka illegal) places per square kilometre. The centre of Palma is the hottest. The red becomes purple: plus 1,000 per square kilometre. Playa de Palma and parts of Calvia have orange or red. Apart from these, the greatest concentrations of darker oranges turning red are on the bays of Alcudia and Pollensa. Most of Alcudia is covered with red or orange. Can Picafort has a red area. Puerto Pollensa is red. This denotes between 250 and 500 illegal places per square kilometre.

The Council says that the two northern bay areas, Palma and Playa de Palma are the island's leaders when it comes to illegal offer. The Council and the government's tourism ministry have them all in their sights. But neither Puerto Alcudia nor Puerto Pollensa (Playa de Muro and Can Picafort for that matter) has been categorised as a so-called mature resort. The ones which are include Playa de Palma, Magalluf and Cala Millor. In these resorts there can be no increase in the overall number of tourist places (hotels, rentals, anything). While this doesn't exclude there being new holiday rentals' places, it makes the creation of new ones very complicated. In order for there to be new ones, the equivalent number have to be removed from the market.

So this situation doesn't obtain in the bay areas. Nor does a further categorisation - that of being "saturated". The mature resorts are all said to be saturated, i.e. they have enough tourist places as it is. In theory, therefore, and subject to the principle of zoning, there can be additional tourist places, e.g. rentals, once the twelve-month hiatus with registration for licences ends.

This may sound like good news, but not necessarily. Resorts such as Magalluf and Cala Millor already know (more or less) where they stand. The bay areas do not. Reading between the lines, one feels that the Council and the tourism ministry have something up their sleeves, and that is because of the high level of illegal offer.

There are marked differences between the bays in terms of accommodation. In Alcudia, the percentage of legal holiday rentals' places is around 20% of the number of hotel places. Alcudia has more than three times the number of hotel places in Pollensa, where, uniquely, the number of legal rentals' places is higher than hotel places.

The Council and the tourism ministry may just take the view that the roughly 9,000 legal places in Pollensa are sufficient. Puerto Pollensa could simply be excluded from the zones. This wouldn't mean the loss of existing legal places but it would mean that there can't be any more.

There is of course a determination to get to grips with the so-called illegal offer. Underlying this is a political necessity to not be seen to be giving a form of amnesty to what has been illegal. The legislation, again in theory, offers the opportunity of legalising apartments that have been marketed "outside the law". The practice, one feels, will be somewhat different. The councillor for land, Mercedes Garrido, who is responsible for defining the zones, has pretty much said that currently illegal accommodation will remain so. In other words, there won't be the chance of making it legal.

The Council hasn't defined exactly how many illegal places there are in Pollensa or Alcudia. It has only given the range per square kilometre. One can, though, make an estimation. The municipality of Pollensa has a land area of almost 152 square kilometres. Not all of Puerto Pollensa or indeed Pollensa and Cala San Vicente are in the 250-500 bracket. Allowing for this and taking a lower average of, say, 150, the total of illegal places would be more than 22,000, a figure which is almost certainly inaccurate. But would around half this number, the majority in Puerto Pollensa, be unrealistic? At an average of four places per property, if these are added to the existing legal supply, one begins to understand why there is something of a housing shortage in a municipality with some 11,500 actual dwellings.

Over the years, and especially once the 1999 tourism law was passed which prohibited apartment rentals, it has constantly been said of successive governments getting tough on the illegal offer that this would have a serious impact on Pollensa's economy. This impact is drawing closer.

The illegal supply in Pollensa has in a sense filled the void of the comparatively low number of hotels. With all the various provisions in the legislation at their disposal, such as overcoming the tenancy act loophole (which admittedly is a nonsense), the Council and the tourism ministry could eliminate a significant chunk of accommodation. And there would be little prospect of a new government of the right - the PP - reversing this, given its previous track record on apartment rentals. The impact is about to be felt.

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