Other southern European tourist destinations protesting at too many tourists and too expensive local rentals include Lisbon, Venice and Barcelona.
ADVERTISEMENTThe Valencia region in Spain is to impose fines of up to €600,000 on unlicensed and black-market short-term rentals and Airbnb-style apartments. This is in an attempt to stop overtourism in the area, which has also been putting added pressure on local public facilities and driving rental prices up in key European tourist destinations.
According to Airbtics, an Airbnb analysis company, the average Airbnb or short-term rental accommodation in Valencia has a median occupancy rate of 79%, being booked for 288 nights annually. With a daily rate of €93 on average, in 2023, hosts saw a typical revenue of about €27,000 for the full year.
As of 15 April this year, there were 9,128 active Airbnb listings, according to Airbtics. Some of the Valencia neighbourhoods seeing the most demand for short-term rentals are Ciudad de las Artes y las Ciencias, La Lonja de la Seda and Valencia Cathedral.
However, the short-term rental market in Spain, includes several more apartments, apart from just Airbnbs. As such, it is already a very established market and plays a key role in propping up the local economy.
Black economy causes worrying safety concerns
On the past few months, there has been a surge of black-market rentals, driven both by local landlords, as well as foreign expatriates wanting to get into Spain's lucrative short-term rental market.
Nuria Montes, a Valencia tourism official said regarding these black-market rentals, as reported by Financial Times: "We cannot allow any kind of underground economy in accommodation. They escape any type of control. Obviously, they don't pay taxes. We don't know whether the owners are fulfilling their obligations to their workers.
"But the main thing is safety. They don't comply with the obligation to communicate the identity of clients to the authorities. We don't know if they follow the rules for fires, emergencies, evacuation plans."
According to Montes, there could very well be 50,000 or more of these unregulated short-term rental apartments across the Valencia region.
Currently, Valencia requires short-term rental owners to have a Valencian Tourism Registry tourist licence. They need to submit key information such as property details, the intended use of the property, compliance with quality and safety standards and owner details in order to get this licence.
Other necessary documents include proof of ownership, property floor plans, energy efficiency certificates, proof of insurance and more.
Valencia is the latest in a list of southern European tourist favourites such as Lisbon, Barcelona, Venice and Split to have announced moves to control excess tourism.
Barcelona has already revealed it is working towards phasing out all Airbnb-style apartments, coming up to approximately 10,000 in number by late 2028. This will also include those rentals operating under a valid licence.
Venice has announced it will be restricting the size of tourist groups to 25 people per group, as well as clamping down on cruise ships, whereas locals in Split are protesting more against party tourists, especially from the UK.
Why the short-term rental market boomed in Spain
Spain has long been a tourist hotspot in Europe, because of its climate, bustling cities, rich culture and robust infrastructure. Over the past few years, this has led to a boom in accommodation options, such as villas, cottages and apartments, instead of the more traditional hotels.
During the continuing cost of living crisis, vacations and short-term rentals are providing a cheaper alternative to tourists who still want a holiday, but don't want to spend too much on hotels. In several cases, they also provide a more authentic holiday experience, with more flexibility, amenities, and privacy as well.
ADVERTISEMENTThe surge of digital booking services and online platforms has also contributed to the escalating rise of short-term rentals, with holidaymakers finding it even easier to book a range of options. In several cases, dubious online booking sites has also allowed unlicensed landlords to list their properties, often at cheaper prices, thus attracting more visitors.
Simultaneously, property companies in Spain have also been investing heavily in marketing, in order to attract more foreign property owners and investors to the Spanish short-term rental market, often by promising outsized returns.
