Editor’s Outlook – Short-term Rentals

Abode2 Managing Editor, Laura Henderson shares her take on the hot topic of how short-term rentals (STRs) have revolutionised our jet-set habits

Since launching in 2008, first off-the-block Airbnb fed the romantic narrative of ‘authentic accommodations’ and sharing your home with others. Suffice to say, that halcyon view has been sullied of late – with holiday lets now deemed controversial in many destinations around the globe, extracting long-term housing from the market, inflating house prices and exerting influence on where tourism activity takes place – but is this really the case? See our in-depth article on the subject in the ‘Coast and Country’ section of our latest issue.

People spent 547 million nights in homes rented via Airbnb, Booking.com, Expedia and?Tripadvisor across the EU in 2022, according to statistical office Eurostat. The nature of regulatory interventions for those lets varies significantly, ranging from light-touch digital registrations, through to licensing schemes and stricter limits on the number of nights per year and per location, a property can be rented out.

Portugal recently announced a ban on new licenses for short-term holiday accommodation,?except in less populated rural areas. Paris lets individuals rent their primary residence on sites like Airbnb for a maximum 120 days a year. Other countries like the Netherlands, require hosts to register or obtain a license from local authorities to be able to rent their properties via such sites.

The nub of the issue is that authorities, until now, have had to rely on platforms’ goodwill, as?there hasn’t been a legal basis for the sharing of these data. The European Commission have come up with a cross-party solution. Going forward, online platforms will automate sharing data about rented nights and numbers of guests with local councils, including giving the power to de-list properties that don’t comply with certain requirements. Most importantly, these new measures will include a common registration system across the EU.

The UK government has recently announced its own consultation on such regulations in?England. The first, led by the Department for Levelling Up, Housing and Communities (DLUHC), proposes requiring hosts to get planning permission from their local councils in order to use a home for a short-term let. The second, led by the Department for Culture, Media and Sport(DCMS), proposes creating a register of all such properties in the country.

But this transition is no panacea, as we’re seeing with the hullabaloo kicking off in Scotland,?with each of Scotland’s 32 local authorities expected to decide for itself how to implement a lettings law requiring prospective new hosts to apply for a special licence before accepting bookings. The Scottish government has extended the registration deadline by six months, but the damage has already been done.

Overbearing regulation stymies national tourism and economic growth. Take the recent report?by Oxford Economics in conjunction with the STAA, which shows that the STL market is now a material engine of the UK economy, contributing ￡27.7bn to the UK economy in 2021 alone– the equivalent of 1.4% of GDP – sustaining nearly half a million jobs. There is both the direct impact for the firms and sectors where visitors spend money, as well as the indirect impact across businesses that supply goods and services to these tourist-facing firms as well as to hosts.

Time will tell whether a workable, scalable solution can be found. Needless to say, what we?don’t want is for tourists to turn their noses up at a depleted staycation inventory and take their vacation spend elsewhere. Let’s stem the bureaucracy-driven exodus.