Should Local Tourist Accommodations Be Under Municipal Control?

30 September 2017

The Lisbon City Council wants to have an active voice in short-term, local tourist accommodations, the Secretary of State for Tourism says that there may be specific limits

Do town councils have the power to limit excessive local accommodations?

Under the current law, no. But Fernando Medina, the mayor of Lisbon, has already announced that if he wins the municipal elections, he will propose to the government that the municipality should have the power to authorise local accommodations (currently unregulated) and thus create limits to the practice in some regions of the city, particularly in historic districts. Ana Mendes Godinho, Secretary of State for Tourism, has also stated that it makes sense, in specific situations, for town councils to temporarily limit permission for new rentals in areas where there is an excess of local accommodations. But Godinho also stressed that any interventions will have to be justified by yet to be defined quantifiable indicators.

Should condominiums have the power to authorise local accommodations in private homes?

It’s one of the issues that is generating the greatest amount of controversy regarding local accommodations. The use of private homes for short-term stays for tourists is a relatively new phenomenon, part of a trend towards the so-called sharing economy, and has been booming all over the world. The practice is new enough that there currently is no accepted set of regulations for this new type of tourism, which existing laws do not address. Condominium boards do not as of yet have any defined role according to the Portuguese laws that regulate the activity, which are under review. In this field, the Portuguese Hotel Industry Association argues that the boards must have the power to authorise local accommodations, except for sporadic cases that do not exceed 60 days per year.

In the case of Lisbon, what are the economic benefits of this type of tourism?

In 2016, local housing generated an estimated economic impact of €1.6647 billion in the Lisbon metropolitan area, according to a recent study conducted by the University Institute of Lisbon (ISCTE) and commissioned by the Portuguese Hotel and Catering Association (AHRESP). This figure includes a direct impact of €285.9 million relating to local accommodation itself, an indirect impact of €549.6 million of tourist spending, and an induced impact of €829.8 million, considering its multiplier effect on the economy. According to the study, local housing last year generated 5,700 direct jobs and 13,400 indirect ones in Lisbon.

When will new regulations be finalised?

According to the Secretary of State for Tourism, new legislation on local accommodation is under review and should be concluded by the end of 2017. The new regulations should go beyond tweaks to current regulations. The rules are expected to address an excess in private tourist accommodations in certain areas, which has been a source of controversy. Including the activity in the formal economy has been the focus of successive changes to local housing laws. In July, the business was included in the new Tourism Enterprises Legal Regime (RJET), a set of laws regulating hotels, which now obliges reservation platforms such as Airbnb and Booking to include the official registration of all available accommodations.

Original Story: Economia Online – Conceição Antunes

Photo: Ana Baião

Translation: Richard Turner