Spain’s Regional Gov’ts Clamp Down on Tourist Apartments

28 January 2018 – El Economista

Spain is breaking records in terms of visitor numbers and, in the age of the globalisation of communications, many people are wanting to make money from renting out their homes. This trend has forced autonomous governments and town halls to introduce legislation so that the so-called collaborative economy does not end up turning into unfair competition.

The tourist housing sector has been calling for the homogenous regulation of its activity for some time now, but for the time being, it has had to make do with the regulations approved by certain autonomous governments and town halls, above all those in the most central neighbourhoods, which are seeing their resident populations emptying out in the face of rising rental prices.

The latest to join the regulation train is the Town Hall of Madrid, which has approved a one-year moratorium for the granting of operating licences for all kinds of accommodation in residential buildings exceeding 90 days.

The moratorium will result in the suspension of licences for the opening of new hotels in the centre, a paralysis that in the case of tourist homes also extends to the districts of Chamberí, Salamanca and Arganzuela.

The Community of Madrid is also preparing a decree to regulate homes for tourist use, which will require owners to have a certificate of suitability to guarantee that their properties fulfil the conditions necessary and which will define digital platforms such as Airbnb as “tourist companies”, liable to fines of up to €300,000.

One of the pioneers in regulating this activity was the Town Hall of Barcelona, which prohibits the opening of new accommodation of this kind in the centre of the city, but does allow the closure of existing ones in the outskirts to be compensated, provided the new units are located in exclusive buildings and have not been used for residential purposes.

Moreover, it has strengthened the detection and sanctioning of illegal tourist apartments and, in the application of Catalan law, has fined operators that publicise them.

The Balearic Islands’ Government is also fining people who let their apartments to tourists up to €40,000, and in the case of real estate agents, tourism brokers and the digital platforms that publish them like Airbnb and HomeAway, it is levying fines of up to €400,000.

In fact, last month, sanction files were opened against Airbnb and Tripadvisor for their illegal supply of rental apartments in the Balearic Islands.

Meanwhile, since 2016 in Andalucía, the Junta has obliged homes used for tourist purposes to be recorded in a register, in order to avoid fraud, intrusion and unfair competition against hotel establishments (…).

After a great deal of controversy with tourist associations, the Canarian Government regulated the use of holiday rentals in 2015, and although the High Court annulled the article that prohibited holiday rentals in tourist areas, the law is still valid because the Executive filed an appeal with the Supreme Court, which has not ruled yet (…).

Any apartment offered through a digital platform in the Community of Valencia must be registered with the Valencian Tourism Agency and is subject to governing regulations in terms of safety and quality.

Murcia, meanwhile, has implemented a specific plan to reduce the current mismatch between the regulated and unregulated supply, putting a stop to intrusion and reinforcing the fight against employment on the black market, which is typically precarious and exploitative.

By next spring, the Community of Castilla-La Mancha will have drafted a law that will put an end to the legislative vacuum in this regard and which, according to the regional Government’s calculations, will allow it to shed light on between 1,500 and 2,00 tourist homes that are advertised on several online portals, but which offer no guarantees for clients and generate no tax revenues for the administration.

In Euskadi, last month, the Basque Government approved a draft decree that seeks to regulate the most tourist aspects of homes, providing guarantees to advertisers, neighbours and tourists, given that the decision to grant licences lies with the town halls, such as those of Bilbao and San Sebastián, which account for two thirds of the almost 2,500 tourist apartments in the País Vasco (…).

In March 2017, the La Rioja Government approved a general tourism regulation, which distinguishes tourist apartments – those that contain three or more accommodation units in the same building – from homes for tourist use, including those that are advertised online.

Last year, a decree entered into force in Asturias to regulate tourist apartments and, according to the most recent available figures, 640 registrations have been recorded and 159 sanction files have been opened (…).

Finally, the Junta de Extremadura is working to reform Law 2/2011, dated 31 January, governing the Development and Modernisation of Tourism in Extremadura, which will materialise this year and which will offer new instruments to help in the fight against fraud involving tourist apartments.

Original story: El Economista

Translation: Carmel Drake

Record Fines For Airbnb & HomeAway in Barcelona

25 November 2016 – Expansión

Airbnb and HomeAway are going to be fined €600,000 each by the Town Hall of Barcelona. The Town Hall, led by Ada Colau (pictured above), will fine both tourist accommodation platforms for continuing to advertise unlicensed apartments.

The mayoress of the city announced the decision yesterday, explaining that the fines will be imposed because both companies have ignored the Town Hall’s request to stop advertising illegal tourist apartments and provide data about the properties.

The first fine amounted to €30,000 for each technological company, but given that both portals continued their activity, the classification of the infringement has now been upgraded from serious to very serious, and the fine has increased to €600,000 for each firm, the maximum permitted under the Tourism Law.

The files have already been signed and the firms will be notified about the fines shortly. The amount of the sanction will reflect: the number of adverts published – 3,812 in the case of Airbnb and 1,744 in the case of HomeAway, according to the Town Hall –; the economic benefit they obtain; their dominant position in the market; and the recurrence of the infringement.

A fine of €30,000 has been maintained for other portals, including: Fotocasa, Open House, TripAdvisor, OnlyApartments, 9flats, Niumba and Rent4days.

Airbnb’s response

The US platform Airbnb, led in Spain by Arnaldo Muñoz in Barcelona, announced its decision to appeal the fine.

“This is a sad decision and Airbnb is going to appeal; less than a month ago a meeting was held between representatives of the Town Hall and Airbnb, where it was agreed that we would work together to support the city’s interests”, said the portal in a statement. Sources at the platform consider that “Airbnb is part of the solution in Barcelona, we want to be a strong ally in the cities in which we operate and we will continue to seek open dialogue with the Town Hall”.

According to Airbnb, there are contradictions in Barcelona’s tourist policies, which favour commercial operators and apartments dedicated solely to tourism in tourist areas, to the detriment of people who want to open up their own homes.

“We have to differentiate between professionals who operate lots of tourist apartments and individuals who rent out their homes from time to time”, say sources at Airbnb. The portal regrets that “Barcelona is resisting what is happening in most other cities in the world”. The portal has reached agreements with more than 200 cities and regions.

Original story: Expansión (by Tina Díaz)

Translation: Carmel Drake

Colau Announces Fines Of Up To €600K For Unlicensed Tourist Flats

29 June 2016 – Expansión

Yesterday, the Town Hall of Barcelona announced that it will impose tougher fines in its attempt to eradicate illegal tourist apartments. The sanctions will amount to €30,000 in the case of individual apartment owners and up to €600,000, in the case of virtual platforms promoting unlicensed apartments against which legal proceedings have already been started. The fines will not affect individuals who rent out a room in their homes, but will apply to those who rent out entire homes and do not have the necessary tourist licences, issued by the Generalitat.

Legal proceedings were launched against Airbnb last year and yesterday, that company issued a strong statement against the municipal regulations, which it described as “disappointing” and “archaic”, given that, in its opinion, “they protect traditional companies and leave no room for individual (entrepreneurs)”.

The main trade association in the sector, Apartur, predicted that the plan “will not work at all”, given that (for it to be successful) it would have to be accompanied by the lifting of the veto that prevents the legalisation of new tourist apartments. Apartur represents 210 companies, which own 7,000 of the 9,600 legal tourist apartments in the city.

The fight against illegal tourist apartments is one of the battle horses that Ada Colau set herself when she was elected mayoress of Barcelona, just over a year ago. The Town Hall said yesterday that in the last year and a half, it has performed 2,505 inspections, of which 2,701 have concluded with the opening of disciplinary proceedings. It also confirmed that it hired more inspectors on Monday.

Last year, Ada Colau opened the first legal proceedings against Airbnb and Homeaway, and following the continuation of the new requirements, nine online portals have stopped advertising unlicensed tourist homes, including Fotocasa, Tripadvisor and Rent4days.

Original story: Expansión (by David Casals)

Translation: Carmel Drake

Hundredrooms Raises €4.1M Additional Financing

18 May 2016 – Expansión

Almost a year after raising €1 million, Hundredrooms has closed a second round of financing, this time for €4.1 million. The private equity fund Seaya Ventures has led the investment, contributing €3.3 million, making it the largest shareholder in the start-up created in Mallorca.

Inveready, Bankinter and Media Digital Ventures, a Spanish media for equity fund (which exchanges shares for publicity), have also participated in the operation. The latter have been partners of Hundredrooms since 2015.

Through Media Digital Ventures, the firm will launch a television campaign on Atresmedia, which will run until September.

The start-up, founded by José Luis Martínez in 2014, is the Google of tourist apartments. Hundredrooms offers flats and houses from Airbnb, TripAdvisor, HomeAway and Booking.com – amongst other partners -, has 4.3 million apartments in its portfolio and plans to exceed 6 million properties by the end of this year.

Growth

The company, which has not disclosed its turnover, will allocate the resources obtained to expand its workforce and its business overseas. In the summer, Hundredrooms plans to enter the Mexican and US markets with the launch of its mobile app and website there. “Before the end of the year, we want to have a presence in Argentina, Chile, Colombia and Peru”, said Martínez.

Hundredrooms recently opened an office in Madrid and plans to open an office in Miami from where it will control its business in the US and Latin American markets. The portal has 25 employees and expects to end the year with 52 staff in total.

Original story: Expansión

Translation: Carmel Drake