Airbnb or not To Be

Several of Europe’s major cities have protested against short-stay tenants through the introduction of increased regulation regarding ‘homestay’ rentals. The issue led to street protests in Barcelona, with websites such as Airbnb being tarred with the suggestion that they restrict the number of properties available to local residents, and increase house prices in popular areas.

Although not all cities have attempted to curb apartments used for such purposes, with London and Lisbon either ignoring or encouraging the situation, several have taken a stand, a factor that should be considered by those aiming to invest in certain areas.

Ranging from Dublin’s site specific example, ruling that the owners of a property now need to apply for commercial use planning permission should they hope to continue renting out properties on a short term basis; to tight regulation in Reykjavik which requires apartments rented out for more than 90 days to have a special licence, many cities are making changes. Several of Europe’s major cities have protested against short-stay tenants through the introduction of increased regulation regarding ‘homestay’ rentals.

The issue led to street protests in Barcelona, with websites such as Airbnb being tarred with the suggestion that they restrict the number of properties available to local residents, and increase house prices in popular areas. Barcelona boasts one of the toughest official attitudes to vacation rentals in Europe, requiring landlords to possess a permit for legally letting their property, with fines of $65,000 issued to Airbnb and HomeAway for listing apartments without adequate licensing. The city has promised to fine a further 22 property rental companies.

Germany’s three largest cities are famously tough, with a ban on all unlicensed rentals brought in on the 1st of May. Landlords are officially permitted to apply for this, yet the number of licences issued will be capped at a relatively small figure, despite protests from landlords. The move was deemed essential to increase the supply of housing available for long term residents, and has led to 40 per cent of Berlin’s Airbnb listings being removed prior to the law’s implementation. The law, which has been challenged unsuccessfully by landlords, is set to take some time to become truly effectual, with all cities implicated still with numerous short term lets available.

However, despite increasingly intense regulation, demand remains high in the aforementioned areas. In contrast, cities such as Lisbon are in fact removing restrictions and phasing out rent controls in order to encourage investment, proving that even amidst concern about short term lets, overseas investment opportunities are rife.