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MADRID

Madrid to suspend holiday-let licences as rent prices spiral

Madrid City Hall has announced it will temporarily suspend the granting of new licences for so-called tourist apartments in a bid to rein in a ballooning industry that's impacting prices and stock of long-term rents in Spain's capital.

Published: 29 April 2024 13:14 CEST
Madrid to suspend holiday-let licences as rent prices spiral
Madrid authorities plan to tighten the rules for holiday lets in the city as rents continue to increase for residents. Photo: Alex Vasey/Unsplash

Madrid authorities also announced they will not authorise the transformation of commercial properties into tourist accommodation in the centre of the city and will increase the fines for tourist properties that do not comply with regulations.

Madrid, like many other cities in Spain, has been suffering from a rise in illegal tourist accommodation with thousands swiftly popping up across the capital.

One of the main obstacles for regulators is how difficult it is to find out exactly how many there are. Madrid authorities have counted 14,699 tourist establishments in the city, 92 percent of which are for tourist accommodation. But, only 941 of these have a municipal licence, meaning the rest are illegal.

READ ALSO: Why Madrid is struggling with its explosion of illegal holiday lets

According to the Inside Airbnb platform though, there are 25,543 tourist apartments listed in the city.

In order to combat the issue,  Madrid City Hall will increase the amount of fines for owning and running one of these illegal holiday lets.

They will set the first penalty at €30,000, the second at €60,000 and the third level at €100,000. Those committing serious infringements or who keep renting out their flats without licences, even after warnings, may have to pay up to €190,000.

Current fines are only €1,000 for the first infringement. If they still don’t comply, a second fine of €2,000 is issued, and if the situation persists, a third penalty of €3,000 will be given.

The number of inspectors to check on tourist rentals will also be increased by 15 percent, up to 75.

In order to help holidaymakers know whether or not an apartment they’re interested in is legal or not, the city will also publish a list of flats with licences and their location on an official website.

“People who want to stay will know if they are in a legal or illegal accommodation and the consequences that may arise because of this” explained Mayor José Luis Martínez-Almeida.

In early 2019, former mayor Manuela Carmena approved a special Accommodation Plan to regulate tourist accommodation in the city. The new rule established among other requirements that tourist apartments should have an independent entrance from the rest of the neighbours.

According to her calculations, this would affect 95 percent of holiday lets in the city, essentially rendering them illegal. The rule was appealed by the sector, but the courts ended up agreeing with the City Council in 2021.

These rules were found to be insufficient as many holiday lets have continued to operate in the capital without a licence, and in late 2023 Martínez-Almeida promised to create new ones. 

Initial approval of the new plan is scheduled for September 2024 and final approval is expected to be in the first half of 2025. 

READ ALSO: Who really owns all the Airbnb-style lets in Spain?

The problem is not only the number of tourist rentals, but the issues they cause for residents. The Inspection and Disciplinary Service received 51 percent more complaints in 2023 than in 2022 that involved homes and apartments for tourist use: 686 compared to 454. 82 percent of which came from citizens.  

Of the total inspections carried out (4,093), it was verified that 478 homes were dedicated to tourist use and 243 were for residential use.

Not everyone is in agreement with the new plan. The Regional Federation of Neighbours of Madrid (FRAMV) believes Almeida’s plan is not enough and that the regulations should apply to the entire municipality not just the central areas.  

The spokesperson for Más Madrid in the City Council, Rita Maestre, has also spoken out against the plan. Maestre believes that the vast majority of tourist apartments already operate freely without a licence, and that the new legislation will do little to change that.

For Exceltur, Spain’s main tourism and hotelier association, there is not enough inspection capacity anywhere in Spain to be able to control that legislation is complied with.

Spain’s Housing Minister Isabel Rodríguez recently called on the 17 regional governments to implement restrictions on short-term holiday lets in areas where rents for locals have spiked, as the national government continues to look for ways to address the country’s housing crisis.

“Wherever there is a greater concentration of apartments for tourists, there is also pressure in the property market ,” Rodríguez said.

Even Madrid’s populist regional president Isabel Díaz Ayuso, whose policies are usually in favour of “freedom” and liberalisation, has said that they “are studying how to regulate holiday accommodation so that higher prices do not expel neighbours”.

Average monthly rent prices in Madrid currently stand at €20.7 per square metre, after registering an increase of 18.2 percent over the last twelve months and 4.8 percent in a quarter-on-quarter rate.

“Vacation rentals are having an impact on the market, especially in the historic centres of cities,” Madrid’s general director of Housing and Rehabilitation of the Community María José Piccio-Marchetti Prado, told Business Insider Spain.

“In Madrid you see it around Puerta del Sol, Plaza Mayor… where there are many tourist homes”.

READ ALSO: Which cities in Spain have new restrictions on tourist rentals?

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TOURISM

FACT CHECK: No, Spain’s Balearics haven’t banned tourists from drinking alcohol

Over the last few days, there have been a slew of sensationalist headlines mainly from UK media stating that Mallorca and Ibiza have banned alcohol.

Published: 16 May 2024 11:35 CEST
FACT CHECK: No, Spain's Balearics haven't banned tourists from drinking alcohol

Anyone having read the news about Spain in the UK over the past few days would be forgiven for thinking that drinking alcohol had been completely banned on the ‘party’ islands of Mallorca and Ibiza, but that’s not exactly the case. 

GB News went with ‘‘I cannot believe this!’ Britons fume at ‘tough’ new alcohol restrictions in popular parts of Spain’, while the Daily Mail wrote: ‘A kick in the Balearics for boozy Brits’.

Euronews reported ‘No more ‘sun, sex and sangria’ tourism in Ibiza and Mallorca under new alcohol laws’ and The Drinks Business simply said ‘Balearics bring in booze ban’.

It’s easy to understand why holidaymakers are confused and there has already been quite a lot of backlash, particularly from Brits.

Most of these articles concede further down that the truth is that the islands have only updated and toughened up laws on drinking in the street, and have also put a stop to shops selling alcohol late at night.

All this is in a bid to try and curb anti-social behaviour which many locals have been protesting against recently.

In fact, the rules don’t even apply to the whole of the Balearics or even the whole of Mallorca and Ibiza, they only apply to three resorts in Mallorca – Palma, Calvià and Llucmajor and one in Ibiza – Sant Antoni de Portmany.

As well as a ban on drinking in the streets in these areas, shops in these locations will also be forced to close between 9.30pm and 8am.

It’s not only that they will be banned from selling alcohol between these times, like many reported, but that they will have to close completely. 

The Governing Council of the Balearic Islands approved the modification of the Decree Law 1/2020 at the proposal of the Minister for Tourism, Culture and Sports, which regulates ‘excess tourism’.

The changes aim to promote responsible tourism and the improvement in the quality of tourist areas.

The ban also extends to one nautical mile or 1.85km off the coast, in a bid to put a stop to party boats from coming in too close to shore or picking up extra passengers.

This doesn’t mean that you can’t drink at all at night. Bars, clubs and restaurants in these resorts will still be serving booze late into the night, you just can’t walk down the street with your bottle of beer.

Anyone found breaking the rules will be subject to fines between €500 to €1,500.

The government of the Balearics also approved an annual spending of €16 million from tourist taxes which will be allocated for the modernisation and improvement of these areas and enforcing the ban.

The new laws came into effect on May 11th and the government has confirmed that they will be in effect until at least December 2027. 

What has changed from before?

The new decree reinforces laws that were brought in in 2020 banning alcohol offers such as two-for-one drinks, happy hours and bar crawls in these areas. These will also be extended until 2027. 

The prohibition of alcohol sales between 9:30pm and 8am was also already in place, but now the shops will be forced to close entirely.

The main change that will affect holidaymakers will be the ban on drinking alcohol on the streets.

Nothing new

But this is nothing new when it comes to Spain. Aragón, the Canary Islands, Cantabria, Castilla y León, Castilla-La Mancha, Catalonia, Valencia, Extremadura, Madrid and La Rioja all have some type of ban on what is known in Spain as botellón, essentially drinking alcohol with friends in a public place (street, square etc).

The Balearics are simply catching up to a large majority of the country, where this is already the norm.

All of this comes on the tail of mass complaints from the locals, particularly in Ibiza, where residents are planning to take to the streets at 8pm on May 24th to call on authorities to act on the impact tourism is having on locals’ living standards.  

It started with calls online to “imitate the protests that took place in the Canaries” in April, with many locals feeling that the issues that Ibiza faces are even worse than those of the Atlantic Archipelago. 

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