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PROPERTY

The legislation has been met with fierce criticism from opposition parties and homeowners
07.01.14 - 10:45 -
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The law that could ban properties being rented to tourists
Approximately 75 per cent of overnight stays in Spain in 2012 were in private apartments or villas.
A controversial new law, widely expected to come into effect this spring, is set to make renting out Spanish properties to holidaymakers much more difficult and costly, according to its critics.
Until now, many owners of second homes, including hundreds of thousands of foreign resident homeowners across the country, have been able to rent their properties relatively hassle-free.
It has been something of a booming sector in recent times, thanks largely to the internet that has enabled visitors from all over the world to contact the owners and arrange their holidays directly.
Indeed, approximately 75 per cent of overnight stays in Spain in 2012 were in private apartments or villas, according to a recent study by La Caixa bank.
However, the tougher new rules will require those who wish to rent out their property to tourists to obtain a licence, that is likely to be fee-based, from their local authorities; to be contactable 24 hours a day, seven days a week, in case of an emergency such as a flood or a fire; and the home will have to pass regular health and safety inspections, amongst other conditions.
Failure to meet all the requirements could, according to officials in Madrid, lead to hefty fines.
Legislation
The government definitively approved the new law, ‘La Ley de Medidas de Flexibilización y Fomento del Mercado del Alquiler’ in June after a vote in the Senate. All the main opposition parties resolutely rejected the draft bill.
The legislation provides legal and fiscal measures aimed at encouraging greater flexibility in the rental sector. However, many argue it will have the exact opposite effect when it comes to holiday rentals.
Opponents of the move claim that Spain’s influential hotel lobby is behind the clause in the law that tightens up on private holiday rental rules.
Under the new regulations, the government has established that properties rented to tourists will no longer be protected by the Law of Urban Leases (LAU), and will be instead regulated by each autonomous region. This has been perceived as a set-back to those who rent their privately-owned properties as regional laws on this issue are, typically, more restrictive than those of the central government.
Miguel Rodriguez, a Seville-based lawyer, tells this newspaper: “There is still further clarification of the legislation needed, but it has been widely suggested temporary leases of apartments in Andalucía will not be permitted unless you own three apartments in the same building, meaning that it will be mainly companies, not individuals, who will be able to rent tourist properties or rooms. However, this too is likely to vary from province to province within Andalucía.”
The Canary Islands, the Balearics and Cataluña already have tougher holiday restrictions in place.
Reaction
There has been a mixed response to the law change from those contacted this week by SUR in English.
Richard Davidson, who rents out an apartment in Elviria to holidaymakers, comments: “This is revenge by the hotel industry pure and simple. The government has been bullied into this. The hotels are claiming unfair competition but are just miffed that they are losing money because more and more people are deciding, either due to economic or taste preferences, to go self-catering. Perhaps the hotels should just up their own game?
“I reckon anyone should be able to rent out their own property to whoever they like – as long as it’s all above board, the place is safe, and the income declared.”
Holiday homeowner Gill Spencer opines: “It’s just another ruse from the Spanish government to get more money out of people because the country is still on its knees financially.
“But what they should also consider is that if people are not able to rent out their properties – which goes a long way to helping pay off a mortgage over a year – foreigners will stop buying here.
“They [the government] keep saying they want to attract foreigners, and boost tourism and real estate - two critical industries for Spain - but they are constantly bringing out stupid initiatives such as this that will only act as a deterrent to inward investment. There needs to be a rethink!”
Suni Choudhary, who has a portfolio of rental properties across the Costa del Sol, adds: “Lots of people choose to stay in private apartments or villas because it works out cheaper than hotels. If there is less and less supply of self-catering options, these people, who by coming here support the whole local economy, will just go elsewhere. The knock-on effects could be devastating.”
However, some holiday rental landlords are supporting the new legislation. Estepona-based Ursula González says: “I know of lots of people who don’t pay tax on their rental earnings – and why should they get away with that? It’s not fair.
“Also, why should the properties not be properly licensed and be safety and hygiene checked to protect the paying clients who come and stay? All this is perfectly normal in other Spanish regions and in other countries. Spain as a whole is just catching up.”

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