Regulation of short-term lets in Spain and Barcelona
19 February 2025, 11:00am (GMT)

Jessica Stacey   0:00
Hello. Good morning, everyone.
I'm Jessica, Situ’s Partner Engagement Manager, and I am delighted to welcome you to Situ's beyond Booking webinar regulation of short term let's into Spain and Barcelona.
So today, who do we have?
We have Richard from Yes Consulting and we have Victoria from European Holiday Home Association. So I will now hand over to our fantastic speakers.
I will let them introduce themselves in a bit more detail.
Richard, over to you.

Richard   0:58
Yeah. Thanks, Jessica. As you can see from the screen, I'm founding partner of Yes Consulting and we work on assisting managers grow their business followed up by a certain amount of M and A as well. In short term rentals, specifically UK, Europe and and the USA.
And I'm going to be introducing Victoria Molnar to you in a minute.
Who is the fount of all knowledge related to EU regulations?
Although she's still smiling, I understand that she manages it.
But there is.
There is some data around.
This is being published by Airbnb recently.
They might just set the scene for this a little bit, and they've been referring to the Oxford economics report and the Oxford Economics report comes from Oxford University, and they consider themselves to be the foremost economics advisors in Europe.
And this report just setting the scene gives data on short term rentals and the numbers five of them are direct tourism. Spend of €127.5 billion.
26.5 billion of that is host earnings, gross domestic product impact, €148 billion. Total tax revenues, which is a very important part of this.
Conversation going forward is just under €40 billion, and lo and behold, it supports over 2.1 million jobs.
So next step is Victoria will introduce herself, but when you've done that, Victoria, would you mind?
Segmenting the various regulations that you are addressing into understandable packages for the rest of us and then we can go through each one. OK, thanks over to you.

Viktorija Molnar   2:58
Thank you, Richard.
So good afternoon everyone.
My name is Victoria and I represent European Holiday Home Association or, as we call it, eh eh, is the voice of short term rental accommodation in Europe and its members are national associations which represent property managers, property owners, sometimes both online short term rental platforms, but also compan.
Which provide ancillary services to the short term rental accommodation providers.
So I'm a lawyer by education and I analyse the laws at the UN Member state level to see how they impact the short term rental industry and if I or my colleagues identify the issue that could significantly impact the industry, we engage in lobbying and advocacy and I.
Personally, talk to the EU policy makers in Brussels to address these issues.
So once I read the definition of the lawyer, they say that the lawyers, somebody who.
10,000 words document and calls it a brief, so I will try to make the information as simple as possible for for the listeners of this webinar.
So, uh Richard, you mentioned very good assessment, right?
Of what impact your mental industry actually does to the global to to the overall economy.
I would.
I would also like to emphasize the fact that short term rentals is a consumer driven phenomenon.
Eurostat has signed a landmark agreement with four online short term rental platforms and Eurostat is European Statistical Office, so they collect statistical information.
So they signed the agreement with the platforms and they published the short term rental data, aggregated data. I think every three months or so and Eurostat calculated that 719,000,000 guest nights were spent in the short term rentals in the EU during the 2020 free.
And this number is increasing on a year by year basis.
I think this number was 20% more than the data than the statistics from the 2022 year of 2022. So this 719,000,000 guest nights in short term rentals in 2023 means that around 125 short term rentals stays.
Are booked each minute.
125 stays each minute, so you can imagine like how.
How people love short term rentals, right?
So it is consumer driven phenomenon.
Now about the regulation of the of the short term rentals.
Short term rentals, if if you look across the world in Europe, they are being regulated pretty much on three main issues.
So it is housing.
It is over tourism and taxation, so regulation of all these issues usually remains in the Member States hands, so in this case, in this pains hands, so Spain is able to.
Short term rentals, if they want to address housing issues over tourism, etcetera.
So they it is being considered here in Brussels at the European Union level, that Member States are in the best position to regulate local issues and housing and tourism are actually local issues.
However, the EU plays a significant role in making sure that EU single market works EU European Union is based on the single market and I'm sure that some of you may have heard this definition.
Single market, but what does it actually mean? The single market? To put it very shortly, it means that people, capital goods and services should move freely within the borders of European Union.
And there should be in principle no restrictions. You know to move.
So that is the utopian world, right?
The issue of regulating housing and tourism and taxation, particularly in the context of short term rentals, is very, very complex in in Europe.
European Union, so we have rules at European Union level and we have rules at the Member State Spanish level.
So however, or whenever we have rules at the European Union level, Member States of European Union, they are always obliged to follow the rules.
So in this case, whenever we have EU rules, Spain is obliged to follow these E rules.
So now what are the key?
Eu legislation.
Existing now.
Which directly effects short term rental accommodation providers.
So the most significant one and is the most recent one.
Well, not the most recent one, but the most significant one is regulation on the short term rental data collection and sharing it has been adopted last year and it will become applicable from May next year 2026. I'm aware that Spain.
Is looking how to apply this regulation earlier and they are already passed the law.
Document the law which shall apply from 1st of July of this year.
So what is now?
Let's talk about deregulation first.
So what does this regulation does?
Deregulation on the short term rental data collection and sharing aims to create a balanced short term rental data sharing and collection framework in the EU.
So the aim of regulation is to improve the transparency on short term rentals.
So so that authorities would be able to get the data, who the short term rental accommodation providers are and based on this data, authorities would be able to do evidence based policies at the local level.
So it is the framework and the Member States, so. So they I said that it's a balanced data sharing framework meaning that.
Member States, if they want to get activity data from online short term rental platforms.
And activity data.
Here is the you know.
For how many? What kind of bookings were made on online platforms?
For how many guests?
The short term rental accommodation was booked for.
This data online platforms will have to feed to the public authorities, but public authorities, they will have to do the homework too.
They will have to create registration procedures for short term rental accommodation providers so it can be hosted, can be property managers.
Where these people, these providers will have to go there, register the unit and they will immediately get the registration number.
So anyway, so all the system is is a bit complicated.
It is being implemented in in Spain as well.
They are working on it, but the idea is that or the hope actually is that as soon as authorities, local authorities will have the real data, they will be able to make local.
Policies affecting, for example, over tourism.
Housing based on evidence based on date so that we wouldn't be in the situation which we are right now. The short term rental rules at the local level are usually based on perceptions and feelings, right? So so that is the regulation. Yeah, Richard.

Richard   10:04
Yeah. So you mentioned one word in there, Vic.
So most of the people listening, probably running accommodation or the managers or the thinking of investing, you said the word platform, which always kind of worries me a bit because platforms are websites run by managers.
They are OT as well.
What is the definition of a platform in terms of the European Union and their understanding and also?
What have you faced in terms of challenges of their understanding?
On a platform is.

Viktorija Molnar   10:37
Yeah, I think I need to be fair to say that this regulation was drafted by having the big online platforms in mind, right?
So there will be this, they will have to create.
API so-called APIs connections with with the Member States.
Points where through which they will be feeding the data, but to responding to your question, what are the online platforms?
Online platforms is being understood very widely at the European Union level.
So it is pretty much everyone who has the website and facilities. The short term rental accommodation bookings for. So there will be it is foreseen in this regulation that actually two different sort of compliance regimes are foreseen for the big guys for the big online platforms and for.
The smaller ones, the smaller ones, they will also have to comply with this regulation and those who have the websites, right.
But they will be able to feed the activity data.
Manually and on the quarterly basis and the big guys will feed the activity data to the authorities automatically and on a monthly basis.
So so this is the regime which deregulation sets.

Richard   11:50
Yeah. Yeah. Before we move on to the other regulations, I know there's a lot more.
This this collection of data from the platforms and you say Spain, you know we know Spain is a super hyper active country in terms of enforcing.
And you know, I'm probably not out of order saying hotels are probably very interested in ensuring this happens.
You know, is there a time scale attached to this that you're aware of?
Or are we waiting for news of when these things can be implemented?

Viktorija Molnar   12:24
So if we talk about the regulation on the short term rental data collection and sharing regulation itself is actually directly applicable, laws for Member States should in principle not do any additional laws.
It's it's just directly applicable, but this regulation is is slightly different because it sets the framework, but Member States need to do the homework, so they need to adapt the registration procedures, they need to create such registration procedures. If they have none.
They have to create connections between online platforms and their and their authority so that the provision of data would flow smoothly.
But as I said, the regulation shall apply from next year, May 2026. In the meantime, as I said, Spain is working how to establish these connection points with the platforms, etcetera, etcetera.
So they want to make this regulation work as soon as possible, and they already passed the law.
The law was passed, I think, at the beginning of this year.
Actually December, I think last year and now according to this law.
The Spanish law implementing the regulation should be applicable from 1st of July this year, so they want to do it faster.

Richard   13:36
So just closing out this Regulation 1.
The data will go at a local level in the 27 states. They will collect it and they'll aggregate it into a single European data set, presumably because there is already a European data set. Isn't there for the major OT as which is reported I think.
Quarterly.
Is that correct?

Viktorija Molnar   14:03
No, it's not quite, Richard.
So every Member State will have a separate sort of connection to online platform, so every Member States will get only the data obviously which they are interested in in their Member State data.
So Spain will have one channel to connect it to the platforms, you know, like France will have another channel.
So we potentially may have 27 different sort of channels where platforms will have to feed.

Richard   14:35
OK.
Well, why doesn't that surprise me?
And if anybody is listening from the UK, whatever Victoria says, I would personally anticipate it will come across the channel at some point as well.
We already have data collecting collection in the UK and if managers aren't aware of it, they should have been reporting from January the first oh January 31st this year.
Perfect. So, Victoria, I'm. I'm particularly interested in in Vida.
And I know this is a very hot topic. Perhaps you'd like to to move on to that one.

Viktorija Molnar   15:08
Yeah, so so Vida is, is another EU legislative act.
It is going to be approved quite soon by the Member States governments.
Probably it is going to happen next month, but Vida is probably the most concerning EU legislative act.
So while regulation, you know we see sort of as an opportunity, we hope that you know the data will be there. Authorities will see the data and they should hopefully lead to better policy making at the local level.
But the Vt file is is very concerning.
As I say, I think it will complicate life for many short term rental accommodation providers.
So what does it do?
It actually shifts the way.
The way you know the value added tax, VAT should be handled by the online entrance rental platform.
So if you are a private person and you are putting the advertisement on online platform.
Online platform will be obliged to charge the vet on the top of the price which you are putting. If you are the SME which falls below the VAT national Vt threshold.
You're sort of considered professional, but you don't pay Vt and if you do the same if you put the advertisement of the short term rental accommodation on online platform, online platform will have to charge the Vt.
And remit this this Vt to the taxation.
Authority where the accommodation is based.
So what?
It essentially does it.
You know, sort of considers that online platform is the supplier of short term rental accommodation services and for that reason they have to charge Vt and remit the VAT. So pretty much these rules are pulling every single non vet payer short term rental accommodation provider into the V.
Net.

Richard   17:09
And is the is the VAT standard across Europe or is it 22% in Denmark and 3% in Luxembourg?

Viktorija Molnar   17:16
Exactly. So we have variety of VAT rates across the EU.
So we have first of all standard vet rates, so it can vary really from you know 21% to 27% across the Member States.
Then we have reduced VAT rates.
So this is usually where hotels are benefiting from rights. We can again vary from 9:00 to, I don't know, 15% year.
In Denmark, it is the biggest 123 percent.
And then obviously there are other categories of the vet.
Rates. So we don't have a single Vt in the European Union and for online platforms.
I think it will be a nightmare because they will have always to understand which Vt rate supplies in which Member States for short term rental accommodation providers, they will have to charge it, remit it. I think it will be just as I said, the life will be very.
Very complicated.

Richard   18:08
Yeah, there's there's a million questions in there and I don't really know where to start because I I don't think we got all day to do this.
But if I was an individual owner and I'm not VAT registered in a European European state and I put my property on Airbnb, they will be obliged to add VAT to that. So and that VAT will be remitted to a central European.
Bank. I guess that controls the VAT input.
It's.

Viktorija Molnar   18:39
So if if you are so, so they are looking at the Vt here based on where the short term rental accommodation is based.
So if you are British and you have a property in Spain, right?
So as soon as you put the property on on online platform, the platform will charge the vet which Spain, you know, puts the Vt on short term rentals.
They will charge the Spanish VAT and they will remit this Vt to the Spanish Taxation Authority.
This is how it works.

Richard   19:12
Yeah. Is there any opportunity for VAT registered companies to do reclaims of VAT is the same as as hotels would?

Viktorija Molnar   19:21
Yes. So I you know the rules are very basic for now and we have been addressing a lot of issues like your your question.
So these questions I think remain unanswered.
So we will have to continue working, you know, raising awareness on the complexity of the short term rental ecosystem because when these rules were drafted, all these complexities unfortunately were not considered and we're not taking into account.

Richard   19:48
OK, OK.
So yeah, it's probably best not to go too far into this, but there is final question on the leader. Is that short term rentals, how do you define a short term rental as opposed to a hotel apartment as opposed to a service apartment? Because do they all fall?
Under the same heading, if they're an apartment.

Viktorija Molnar   20:07
So short term, Vita defines puts definition for short term rentals and they say that short term rentals is of a similar nature as hotels and they are being rented for less than 30 days.
Subject Member States do not have other definitions, so they are sort of sort of possible possibilities for Member States not to apply this deem supplier regime this Vida.
But we will see what Member States decide.
But in principle, the idea of this Vt proposal was to assist, as they say it, to level the playing field between the short rentals and hotels.
So they say that look hotels are paying so many taxes and short term rentals play none.
For that reason, they decided to pull all the non VAT payers into VAT net to level the playing field.
Which we of course do not agree.

Richard   21:02
OK.
You're all right.
Thanks for that, Vic.
So reporting and evida, I mean in terms of other things coming down the pipeline, obviously registration and licensing are also attached, I guess to reporting. I mean what are the other you know things that you would consider to be highlights and the things that give you sleepless night?

Viktorija Molnar   21:24
I think.
What contribute is to my to the lack of sleep during my nights is actually local regulation.
Because, as I said, Member States, they still retain the power.
Well, they retain the power to regulate short term rentals in on issues such as housing and over tourism.
Right. So it is their competence and I think this is where the biggest problems kicks in because most of the short term rental rules and especially in Spain are not based on evidence and are not based on data.
For that reason, you know, I think such rules just causes issues for absolutely everyone to the enforces, to the public authorities, because these rules, I mean are are usually hard to enforce.
They usually don't do anything.
They don't, you know, achieve any policy goals with these rules and at the same time, I think it's it makes huge implications on the short term rental industry, right?
So they are being banned.
They are exposed to over overly restrictive measures.
Et cetera.
So think local rules are the most problematic for short term rental industry, and especially in Spain.

Richard   22:32
Yeah, I mean, I don't want to put you on the line and get a quotation out of you, which is, which is incorrect, but you obviously study a lot of data and have a lot of information. Is there any information that shows that short term rentals are dam?
The housing market substantially.
I can't understand in certain areas there might be, you know, some significant influence, but in general is this happening?
Do you think particularly in Spain?

Viktorija Molnar   22:57
No, no, you know, like I I think let's let us be fair.
There could be situations in certain cities, in certain areas within the cities, right?
So where there's a huge sort of.
Number of short term rentals and they may have some sort of impact to the housing right. But if you look at all these restrictions which are being put on short term rentals, you know and if you look at the worldwide situation, these restrictions are very unfair.
Because they are literally blaming short term rentals for, you know, all the housing issues, all the over tourism issues, even the climate change fundamentals are being blamed and there's no data to prove that. The short that short term rentals are the only and and you know the only.
And lonely, sort of.
Factor which you know causes the housing, the lack of housing.
Affordable housing increases over tourism, etcetera, so.
And that is very obvious.
So for example, I'll maybe mentioned in New York City, right.
So New York City bench, short term rentals 1 1/2 years ago and the idea was, you know, the same that there are no housing in New York City and for that reason people should not be able to do the short term rental after one and a.
Half years, New York City is now reconsidering it.
They are thinking to revert the ban because.
This ban did absolutely nothing.
Nothing. The housing, the prices of the housing is still increasing the rent, the prices of the rents are still increasing. The vacancy rates remain unchanged.
So nothing changed. What changed?
Is that you know, people as they couldn't advertise their properties on legal channels on on online platforms, they went and started advertising properties on you know through our channels which are not regulated. And here I'm talking about social media such as Facebook and Instagram, because these social media.
Platforms, they usually fall out of the scope of regulation.
And they fall out of the scope because it is very difficult to track and monitor who is doing what on on the social media platforms.
So these these, you know, these sort of bans, they don't do the job.
They don't work and they don't work because.
The you know we we are facing very complex housing dynamics, right?
So you know, there are so many, so many factors contributing to the lack of housing.
To the increasing prices and I think it is very unfair to to blame short term rentals for for all the existing issues.

Richard   25:38
Yeah, it's quite interesting because today there was an article published in the UK in The Telegraph.
And it was from there's some various property organisations with data, and essentially it's it's the same issue. The government is enforcing regulations, you know, FHL removing the benefits.
There's there's increases, lack of housing, etcetera, etcetera.
And this report is essentially saying that people will buy second homes.
But they will be the even wealthier people, and they're already buy these homes and these places will actually become empty because tourism is actually the main the main income stream for them.
So I know you.
You know you're in Spain and Barcelona is the most noisy of cities in Spain, particularly the mayor who seems to he seems to be driving this through his political ambitions but.
So what about Barcelona, Vic?
What's what's the prediction of what might happen in? I think it's three years.
This is it, or two years.

Viktorija Molnar   26:40
Yeah. So look, so the Barcelona has the licensing regime, right?
They introduced the licensing regime 10 years ago and they said, look, we are putting the sort of the benchmark of 10,000 licenses for short term rentals in the city of Barcelona.
They had this licensing regime for 10 years, and regardless of these restrictive measures, which we consider, these are restrictive measures.
The rents still during the last 10 years have risen by 70%.
Sent the while the average price of the home has increased by 60%, so it just shows that you know, even those quite restrictive situation in Barcelona which put only 10,000 licenses available for short term rentals, it made absolutely no impact to the housing situation in bar.
And yet, as you said yourself, the mayor of Barcelona still aims to phase out absolutely all licenses, right?
So there will be.
There should be.
According to his plans, 0 short term rentals.
So this you know I think will make absolutely no impact because the Oxford economics did the the study in 2023 and they said that the proportion of the overall housing stock dedicated to short term rentals in Barcelona does not exceed 1.5%. So mayor.
Barcelona literally is addressing 1% of the housing, so.
What kind of impact you can, you know, you can expect if you put these over restrictive measures.
And you know, Mayor of Barcelona can, of course he can do the ban.
We don't see that it follows the rules, so we will do our work on our side, but according to Price Waterhouse Cooper's study, they believe that this ban on short term rentals in Barcelona will put 1.9 billion of City's GDP.
In risk and it will probably put even 40,000 jobs at risk in Barcelona because we we know the short term rentals is a very heavy labor activity, right?
So everything's being outsourced.
It's it relies on the ancillary service providers etcetera.
So I think it will be just lost lost situation in Barcelona and it will.
It will not bring the so much expected.
You know it.
I don't think the Barcelona Mayor will achieve the goals which he wants to achieve.

Richard   29:10
Maybe. Maybe you'd like to be mayor of Barcelona, Victoria, a lawyer in charge of a city that kind of makes sense. Evidence based politicians.

Viktorija Molnar   29:19
Yeah.

Richard   29:20
Yeah. I mean it's, you know, we're coming probably pretty close to the end of this and I don't know if Jessica's allowing people to ask questions, but I mean, I have a question.
Let's assume that I am actually an operator of apartments like a typical manager in Spain at the moment.
I mean, everything you said is worrying in a number of ways.
Won the VAT situation because in certain situations it's going to make it much more expensive for a guest to book.
So you know, I'm sure there's escape routes and there's probably direct booking and various other ways people will try and navigate that. But it does make it look as though travelling could be more expensive.
Which might do the UK wonders.
Because everybody's leaving the UK to go to Spain on holiday, by the looks of it, every year.
The other thing is that the description of short term rentals and hotels and hotel apartments, I mean, I've definitely noticed a.
A strategic trend from large managers to think, OK, do we want distributed?
Do we want properties everywhere?
Maybe we should start thinking about hotel apartments and stepping into the hotel scene in what might be considered a short term rental way by automating everything and still using the same distribution channels.
I mean, is that something you're hearing? People are thinking they need to remodel?

Viktorija Molnar   30:47
Yeah, absolutely. I think you know, that's the probably the result of these over restrictive measures against short term rentals 'cause, you're putting such rules where people providers cannot comply with people will start looking for ways how to go around them. And I think you perfectly made examples you.
Know people.
You know, just finding the ways how to do the business.
By literally, you know, doing it somehow in different ways.
So and I think this what is going to happen if if these rules will continue, you know to be restricted for in Spain, people will find a ways how to go around them.

Richard   31:29
Yeah. OK.
Well, kind of final final question. In terms of what's coming down the down the pipeline because you all know what is coming. I mean I have heard things like sustainability are on the horizon as well and we're seeing that in various quarters.
Is that being?
Is that being talked about at some point in the future, you're going to have to have some regulatory body auditing your property and otherwise it won't be rentable?
It'll be rental anyway in Barcelona.
But you know, is it?
Is this something that's happening?

Viktorija Molnar   32:02
Yes. So EU is also working on this Green Deal, so-called Green Deal.
Which part of it obliges property owners you know to update and renovate their properties in the and comply with all the environmental standards, right?
So while of course it is, it's a good thing to do, but at the same time I think it can cause a lot of burden for the property owners.
Especially those who have old properties.
Because all properties of course you know they need to comply with different standards, right?
So if you have a heritage building obviously have to comply with renovation, which is specifically made for heritage buildings, right?
So that increases a lot of cost for the property owners and it can be actually an obstacle to provide your rental services because I know that some Member States in Europe.
They have made such a high environmental.
Standards for the property owners.
That, and if they will not achieve that standard, they will not be able to rent the properties for short term rentals.
So these environmental certificate standards can actually act as an obstacle to provide treatmental accommodation services.

Richard   33:20
OK.
I think I think, I think there's enough terror from this conversation already. If you're an operator in Europe.
So just final thing.
The associations are very important part of Europe and the UK in terms of contesting many of these things and making sense of them.
So do you just want to reinforce who you're working for, Victoria, and how people can actually join the associations?

Viktorija Molnar   33:51
Yes. So I'm I'm European Holiday home association.
This is the European association which unites national associations online platforms, but also companies which understands the meaning of doing business, doing business and doing the lobbying for their benefit.
But we also have national associations in in different Member States and we have a number of national say actually local associations in Spain.
Which are really working hard to make the rules.
At the local level, better for the providers of short term rental accommodation services. So I would really encourage you to join these associations because they have all the knowledge about the local rules which are changing a lot in Spain and they're the ones who can help you act.
To to deal with certain situations and they can answer to your questions more specifically.

Richard   34:44
Thanks, Vic.
So Jessica, I'll move back to you, but it be really good if situ could actually make sure that the the links are published to the associations and possibly Oxford economics report as well.
So hand it back to you, Jessica.

Jessica Stacey   35:01
Gosh, hello.
Thank you so so much.
I mean, thank you, Richard, for hosting today and Victoria for your valuable insights and to everyone at which was well, which has joined today, absolutely fantastic discussions.
So what is next for situ? Or let me tell you, I will quickly make sure that the screen's covered.
There you go so.
We can see the learnings for this webinar on the left hand side.
And in regards to what is next for situ beyond booking webinar series, we have the regulation of short term let in Holland and Amsterdam on the 25th of March at 11:00 AM with Marta business development manager and she's from the Eurohome relocation services.
And Daniel, which is the country director from Eres relocation, if you would like to join please see the link in the webinar chat to register.
I will leave this slide up for a few more minutes for you to read, but I just want to say thank you ever so much again and we look forward to seeing you.
Our next webinar.
Thank you very much.