Did Locals Get Kicked Out by Airbnb
Mallorca is a hot property market. Is Airbnb to blame?
Are Airbnb and similar digital platforms really to blame for skyrocketing rents and shortages of affordable housing in Mallorca’s capital?
Well, that depends on who you talk to. With tempers high on both sides, the debates are still continuing long after the law to ban short-term holiday rental flats in Palma was put into effect. Affordable Mallorca takes a look at both sides of this thorny issue.
Team Anti Airbnb #
There is nothing worse than having residents who can’t live in their city nor afford a rent.~ Antoni Noguera, Palma's Mayor from 2017 to June 2019
Strange bedfellows exist within the Anti-Airbnb campaigners.
There are the local resident’s associations, who are angry over skyrocketing rents, lack of affordable housing, and long-term renters being evicted by property owners who were turning their flats into more profitable holiday lets. Many are also rather fed up with the vast hordes of tourists who descend upon the city centre, particularly in the summer months. They also claim that the lack of housing in Palma is forcing them to look outside the city, thus abandoning their neighbourhoods and slowly wiping out the charms each one of them had to offer.
Then there are the hoteliers, who believe these rentals posed unfair competition in an already competitive market.
And yet another faction is the regional government, who had become increasingly alarmed at the lack of accommodation for seasonal workers, who keep the tourist engine moving forward, and the communities at large, whose neighbourhoods are being transformed before their eyes. Additionally, the government was annoyed by the huge number of unlicensed tourist flats, up 50% between 2015 and 2017 according to local reports, and the owners who did not pay taxes accordingly on rental incomes. Before the new law, studies showed that only 645 properties used as holiday rentals out of an estimated between 11,000 and 20,000 were properly licensed.
Team Pro-Airbnb #
“We have to be careful that we don't have so much regulation that
would prevent all of the people who are benefiting from Airbnb to
benefit.” - Nathan Blecharczyk
The Pro-Airbnb group is fairly obvious.
One the one side, you have the property owners and their various associations. Obviously, they felt the sting in their pocketbooks, but they also believe the few (the hotels) have destroyed the livelihood for the many (hosts) in a sort of reverse Robin Hood scenario. They argue that in Palma many local families actually shared their homes, in the true spirit of Airbnb, bringing different cultures and people together, breaking bread together, becoming friends. They say this ban destroys not only that comradery, separating tourist from local like in the “old days”, but also takes away that bit of extra money they earned to help pay for a higher cost of living on the island.
There are no studies or confirmation of which flats were being used exclusively as income properties, with no owner living concurrently on-site, so it is difficult to say what the actuality is in this case.
On the other, you have Airbnb itself, who feels they are being scapegoated for city governments who have been slow off the mark to provide decent, well-priced housing for residents. To this end, they conducted a study where they state that of the more than 11 million visitors to Mallorca in 2017, only 5% stayed in an Airbnb. These figures are slightly deceiving, though as the report was based on an island-wide usage and were not specific to Palma alone. They also say the positives outweigh negatives in many places, allowing people to stay outside traditional tourist areas where they frequent local businesses, giving the economy a boost.
The Facts, Figures and Fallout #
Regardless of what side of the fence you fall on, there are some facts that cannot be overlooked. Since 2013, rents in Palma have increased by a whopping 40%. The regional government partially blames Airbnb and the other portals, though they know they must shoulder at least some of the blame. Still, it’s hard to refute that there is a direct parallel between the steep jump in rental prices and the proliferation of Airbnb.
Additional measures, such as a maximum 60 day rental period per year, are incentives for some owners to put their apartments back up on the open market for long term rentals, but some are throwing their hands up and just putting them up for sale, which could be good or bad for the real estate market depending on asking prices. If a correctly priced apartment goes on the market, perhaps a young couple just starting out will be able to finally afford a home that previously was being used by short-term revellers with no investment in the area.
As a side bar, it should be noted that the ban applies only to apartments. Detached homes are not part of the ban, nor are legally licensed homes outside of Palma. The fines for flouting the ban are steep, up to €40,000, and the government has employed a group of inspectors to ensure compliance. There is also an online reporting system for the public so they can report suspected rule breakers to the authorities.
Specifics for Isla Baleares #
If you own a property and want to generate additional income, here's an article to better understanding how you may be able to legally list your property on a digital platform. What Landlords Need to Know
These peer-to-peer (P2P) platforms include Airbnb and Vrbo yet you can quickly do a Google Search and find an aggregator where you can list your property on multiple platforms. Here's the Airbnb article on renting in Isla Baleares >> Rules- Isla Baleares
If you want to see the latest market information on short-term rentals, check out this site >> Vacation Rental Data. This site allows you to analyze any address for how much income you should be able to generate for your property. You can compare your property to others to see how to maximize revenue.
Here's a letter posted by Airbnb directly to provide their position>>
Affordable Mallorca's Position #
From the Publisher: We understand that many of our readers have second properties here on the island that sit empty for periods of time. Sitting empty creates mold and mildew issues and security threats due to squatters. You do need to understand how these issues affect the value of your property.
We also see the full-time resident's perspective. If you work or want to retire in the Baleares, property prices have gone through the roof for both purchasing and renting. Local Mallorquins and expats are priced out of their towns and villages, especially in the coastal areas. Even in Sineu, it's impossible to find an affordable property.
So, to answer the original question, “Did locals get kicked out by Airbnb?”, I guess that depends on where you sit.
#mallorcaairbnb #palmademallorcaairbnb #airbnbspainillegal #spanishrentallaws #airbnbinspain
By Stephanie Horsman
21 May, 2022