Opinions mixed on how the city’s move will impact local
hoteliers with some suggesting supply will be insufficient and wondering how
and if the ban will be imposed.
Note: This story originally appeared on Phocuswire
BARCELONA - decision to ban short term rentals has prompted
a slew of chatter from industry folk - many of whom are criticizing the
decision and calling out potential unintended consequences - while some of the
large platforms in the sector have not commented publicly on the Spanish city’s
move.
On Friday, Barcelona Mayor Jaume Collboni said that by
November 2028 apartment rentals for tourists will cease to exist as the city
takes steps to transition the existing properties to residential use only.
Barcelona currently has 10,101 properties that are licensed
for tourist use – a restricted count in place since 2014. “These 10,000 tourist
apartments [will] become residential apartments in November 2028,” said
Collboni.
When contacted by PhocusWire, Airbnb, Booking.com and HomeToGo declined to
comment on the new ban, and both Airbnb and Vrbo suggested questions be
directed to the European Holiday Home Association (EHHA).
The sweeping ban comes in an effort to improve Barcelona’s
housing market, Collboni wrote in a post on X. “We want to guarantee the right
to live in Barcelona and deal effectively with the housing crisis we have been
suffering for years.”
The [hotel] supply will be absolutely insufficient to fulfill the demand... If the city council has the [means to] enforce this ban, I doubt they do, this move will significantly hurt the main source of revenue of the city.
Ivar Yuste
Some supported Collboni’s move including Spain Housing
Minister Isabel Rodriguez Garcia, who took to X to share her approval: “This is
what it is about, making all the necessary efforts to guarantee access to
decent and affordable housing,” Rodríguez García wrote.
Unintended consequences?
Not all see the lockdown on STRs as a cure-all to the
housing woes Barcelona is currently facing.
Even some on the hotel side - which stands to benefit from a
shuttering of STR properties - see the move as detrimental to the city’s future
in terms of tourism. Ivar Yuste, partner at PHG Hotels and Resorts said the
city is essentially “shooting itself in the foot.”
“The tourism future for Barcelona is not bright,” said Yuste. “They have in
place a hotel ban that inflates the asset price of the hotels, inflates rates
and is diverting demand to the apartments. If you now ban also the apartments,
the whole thing will get out of control… I cannot think of any positive outcome
out of this situation.
“The [hotel] supply will be absolutely insufficient to fulfill the demand... If
the city council has the [means to] enforce this ban, I doubt they do, this
move will significantly hurt the main source of revenue of the city.”
Yuste predicts hotels’ average daily rates will spiral out
of control and that tourists will stop coming to Barcelona. In New York City,
where government leaders passed restrictions on STRs last fall, hotel average
daily rates and occupancy have surged.
AirDNA chief economist and senior vice president of
analytics Jamie Lane echoed Yuste’s outlook, but cautioned he’s not an expert
on the hotel industry in Barcelona.
Typically, when restrictions like this one are put into
place there aren’t enough hotel rooms to accommodate guests in the same way
STRs could, Lane said, noting AirDNA has seen that outcome play out in New York
and other major cities.
So, there won’t be a number of vacant hotel rooms to match
the number of removed units – especially assuming many units are multi-room
properties accommodating a number of guests at a time.
“When there’s not enough supply for the amount of demand
going in, typically [that] means that prices go up,” said Lane. “And that has a
way of reducing overall demand, just people that get priced out of the market …
So, you should see fewer people actually traveling to Barcelona as a result of
something like this.”
By supporting STRs, we encourage a more equitable distribution of tourism's economic benefits and promote a more sustainable and locally integrated model of tourism.
Vanessa de Souza Lage
And the EHHA said in a statement that banning STRs not only
won’t fix housing concerns, it will in fact hurt the city’s residents who make
their living in support of the tourism industry.
“This extreme proposal will not have any effect on the housing crisis as less
than 1% of homes in Barcelona are short-term rentals,” the association said.
“We urge the City Council to engage with the broad STR
industry and look for a solution that does not erode a key part of the tourism
supply in Barcelona, with very negative side effects for local families,
commerces, from bakers to cafés, cleaners and everything in between.”
In addition, the EHHA said the Barcelona ban may breach
European laws. The association said the European Commission has already
notified Spanish authorities that the restrictions “are not suitable to attain
the objective of fighting housing shortage and are disproportionate to that
objective" and that they "seem to breach the EU’s Services Directive.”
The EHHA said the investigation is ongoing and could result in the EU taking
legal action against Spain.
Vanessa de Souza Lage, co-founder and CEO of STR certification platform
Sustonica and a Barcelona resident is also concerned about the impact of
the ban.
“STRs are essential for dispersing tourism throughout the city. For instance,
my neighborhood, which has no hotels, benefits from STRs bringing in visitors,”
she said.
“By supporting STRs, we encourage a more equitable
distribution of tourism's economic benefits and promote a more sustainable and
locally integrated model of tourism. This approach not only strengthens the
local economy but also enhances the visitor experience by fostering genuine
connections with the community. For these reasons, cities, and specifically
Barcelona, should not ban STRs."
What the STR market looks like in Barcelona right now
Last year, nearly 16 million travelers visited Barcelona
proper, according to Barcelona Tourism Observatory.
While licensed rental properties don’t account for a large portion of
residential properties in the city, experts say the STR market in Barcelona may
actually be much more substantial than what’s been licensed officially by the
government.
Global travel intelligence platform Mabrian did a deep dive
on the Barcelona STR sphere based on Airbnb data in response to the news,
finding the market is potentially 63% larger than projected by city officials
with 15,800 units listed on Airbnb in the city. That number accounts for around
56,700 beds, which is about two-thirds of the beds provided by hotels in the
city, according to the Barcelona Tourism Observatory . And that figure doesn't
include properties listed on platforms other than Airbnb.
A total ban of STR does not appear to be reasonable as there is a substantial market that needs and expects this kind of lodging.
Javier Delgado
“Getting the record straight in terms of dimensioning the
market is crucial for policy making, especially considering that, according to
our data, approximately one out of four rental units in Barcelona do not count
on the mandatory license for tourist rentals,” said Carlos Cendra, partner and
chief marketing and communications officer at Mabrian.
Lane said AirDNA's figures put the total number of listings
on Airbnb and Vrbo in Barcelona at about 17,500, although in the case of Airbnb
some of those are for private rooms and he said it’s not “100%” clear whether
private rooms are exempt from the new ban - or whether other licensing
exemptions such as longer-term apartment rentals (30 plus days) would be
exempt.
Will rentals really disappear?
Yuste predicts that some who own and manage short term
rentals in Barcelona will continue to do so without a license, for example by
using unofficial channels such as social media platforms or by communicating
directly with travelers.
Meanwhile, governments and regulators around the globe are
grappling with how to manage short-term rentals while also accommodating the
needs of local residents.
In February the European Union announced new rules on
how to STR data should be shared and collected, in an effort to create a
"transparent and responsible platform economy in the EU."
Javier Delgado, managing partner and CEO for EMEA at Mirai,
said that while he believes a lack of regulation has in fact contributed to the
huge growth in new properties being listed as short-term rentals, he doesn’t
think a total ban similar to Barcelona's is an appropriate response.
“A total ban of STR does not appear to be reasonable as
there is a substantial market that needs and expects this kind of lodging,” he
said.
An ideal solution would be to have European regulation that
ensures fairness and sustainability, Delgado said. “In any case we must
acknowledge that this is easy to say and difficult to do.”
Lane believes many major cities are looking for a “middle
ground.”
“It’s only a handful of cities, major cities, that we've
seen these types of regulations,” said Lane. “Primarily because tourism is such
a big part of most of the cities… most cities want to find a line between
allowing people to continue to accommodate guests and making sure that it’s not
really impacting the long-term housing market.”