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Madrid to suspend holiday-let licences as rent prices spiral

Madrid City Hall has announced it will temporarily suspend the granting of new licences for so-called tourist apartments in a bid to rein in a ballooning industry that's impacting prices and stock of long-term rents in Spain's capital.

Published: 29 April 2024 13:14 CEST
Madrid to suspend holiday-let licences as rent prices spiral
Madrid authorities plan to tighten the rules for holiday lets in the city as rents continue to increase for residents. Photo: Alex Vasey/Unsplash

Madrid authorities also announced they will not authorise the transformation of commercial properties into tourist accommodation in the centre of the city and will increase the fines for tourist properties that do not comply with regulations.

Madrid, like many other cities in Spain, has been suffering from a rise in illegal tourist accommodation with thousands swiftly popping up across the capital.

One of the main obstacles for regulators is how difficult it is to find out exactly how many there are. Madrid authorities have counted 14,699 tourist establishments in the city, 92 percent of which are for tourist accommodation. But, only 941 of these have a municipal licence, meaning the rest are illegal.

READ ALSO: Why Madrid is struggling with its explosion of illegal holiday lets

According to the Inside Airbnb platform though, there are 25,543 tourist apartments listed in the city.

In order to combat the issue,  Madrid City Hall will increase the amount of fines for owning and running one of these illegal holiday lets.

They will set the first penalty at €30,000, the second at €60,000 and the third level at €100,000. Those committing serious infringements or who keep renting out their flats without licences, even after warnings, may have to pay up to €190,000.

Current fines are only €1,000 for the first infringement. If they still don’t comply, a second fine of €2,000 is issued, and if the situation persists, a third penalty of €3,000 will be given.

The number of inspectors to check on tourist rentals will also be increased by 15 percent, up to 75.

In order to help holidaymakers know whether or not an apartment they’re interested in is legal or not, the city will also publish a list of flats with licences and their location on an official website.

“People who want to stay will know if they are in a legal or illegal accommodation and the consequences that may arise because of this” explained Mayor José Luis Martínez-Almeida.

In early 2019, former mayor Manuela Carmena approved a special Accommodation Plan to regulate tourist accommodation in the city. The new rule established among other requirements that tourist apartments should have an independent entrance from the rest of the neighbours.

According to her calculations, this would affect 95 percent of holiday lets in the city, essentially rendering them illegal. The rule was appealed by the sector, but the courts ended up agreeing with the City Council in 2021.

These rules were found to be insufficient as many holiday lets have continued to operate in the capital without a licence, and in late 2023 Martínez-Almeida promised to create new ones. 

Initial approval of the new plan is scheduled for September 2024 and final approval is expected to be in the first half of 2025. 

READ ALSO: Who really owns all the Airbnb-style lets in Spain?

The problem is not only the number of tourist rentals, but the issues they cause for residents. The Inspection and Disciplinary Service received 51 percent more complaints in 2023 than in 2022 that involved homes and apartments for tourist use: 686 compared to 454. 82 percent of which came from citizens.  

Of the total inspections carried out (4,093), it was verified that 478 homes were dedicated to tourist use and 243 were for residential use.

Not everyone is in agreement with the new plan. The Regional Federation of Neighbours of Madrid (FRAMV) believes Almeida’s plan is not enough and that the regulations should apply to the entire municipality not just the central areas.  

The spokesperson for Más Madrid in the City Council, Rita Maestre, has also spoken out against the plan. Maestre believes that the vast majority of tourist apartments already operate freely without a licence, and that the new legislation will do little to change that.

For Exceltur, Spain’s main tourism and hotelier association, there is not enough inspection capacity anywhere in Spain to be able to control that legislation is complied with.

Spain’s Housing Minister Isabel Rodríguez recently called on the 17 regional governments to implement restrictions on short-term holiday lets in areas where rents for locals have spiked, as the national government continues to look for ways to address the country’s housing crisis.

“Wherever there is a greater concentration of apartments for tourists, there is also pressure in the property market ,” Rodríguez said.

Even Madrid’s populist regional president Isabel Díaz Ayuso, whose policies are usually in favour of “freedom” and liberalisation, has said that they “are studying how to regulate holiday accommodation so that higher prices do not expel neighbours”.

Average monthly rent prices in Madrid currently stand at €20.7 per square metre, after registering an increase of 18.2 percent over the last twelve months and 4.8 percent in a quarter-on-quarter rate.

“Vacation rentals are having an impact on the market, especially in the historic centres of cities,” Madrid’s general director of Housing and Rehabilitation of the Community María José Piccio-Marchetti Prado, told Business Insider Spain.

“In Madrid you see it around Puerta del Sol, Plaza Mayor… where there are many tourist homes”.

READ ALSO: Which cities in Spain have new restrictions on tourist rentals?

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PROPERTY

Too hot or too cold: Spain’s homes struggle to keep comfortable temperatures

Amid rising temperatures and more extreme weather, new data reveals that a significant proportion of Spaniards are struggling to keep their homes at comfortable temperatures during the winter and summer months.

Published: 14 May 2024 09:51 CEST
Too hot or too cold: Spain's homes struggle to keep comfortable temperatures

Spaniards are increasingly finding it difficult to keep their houses at comfortable temperatures during the summers and winters, and the problem has grown markedly over the last decade.

This follows new data released from Living Conditions Survey recently published by Spain’s National Statistics Institute (INE), which revealed that over a quarter of families in Spain struggle to heat their homes sufficiently in winter and that a third are too hot in summer.

The percentage of households reporting difficulties in keeping their homes at a comfortable temperature has increased by almost ten percent overall in the last decade.

READ ALSO: Why are Spanish homes so cold?

In the colder months, the proportion that say they can’t keep their property sufficiently warm during winter has grown from 17.9 percent in 2012 to 27.5 percent in 2023.

The summer heat poses an even greater problem for Spaniards. The percentage of households struggling to keep their homes cool enough during the summer months has risen from a quarter (24.8 percent) to over a third (33.6).

READ ALSO: Ten ways to protect your Spanish property against the summer heat

This comes as Spain faces record breaking temperatures year round and rising energy costs. According to Spain’s State Meteorological Agency (Aemet), 2023 was the third hottest summer since records began, surpassed only by 2022 and 2003.

In summer 2023 alone, four official heat waves were recorded, lasting a total of 24 days.

READ ALSO: How the right orientation of your Spanish home can save you hundreds on energy bills

However, though rising temperatures clearly play a role, so too does geography, income, and poor energy efficiency caused by poor insulation.

Murcia is the region where the highest proportion of households have problems keeping their homes cool in the summer, with almost half of families polled saying they are in this situation (46.6 percent). Murcia was followed by Madrid, Andalusia, Catalonia, Aragón and Extremadura, where the figure is 36 percent.

At the other extreme, in the cooler, northern regions of Asturias, Cantabria and Galicia, it is not even 20 percent.

Despite that, it is also the southern regions that struggle the most with keeping their houses warm enough during the winter. Murcia is once again the region where the highest percentage of families are unable to keep their homes at an adequate temperature over the colder months.

40.1 percent of Murcianos say they find it difficult to heat their homes over winter. In Andalusia and Extremadura the figure is almost 35 percent, the other two regions that top the list, meaning the three most southern regions of Spain came out on top.

In contrast, in Navarre, Castilla y León​​, and the Basque Country, less than a fifth (20 percent) of households report problems maintaining a sufficiently warm temperature at home during winter.

Household income also factors into this problem. INE data shows that the proportion of households struggling to maintain an adequate temperature in their homes increases as average income decreases. Among families with the lowest income levels, 38.9 percent say that they are cold in winter and 41.3 percent say that they are too hot in summer.

Of the regions that struggle to keep their homes warm or cool enough, Murcia, Andalusia and Extremadura all have some of the lowest median per capita incomes in the whole country, along with some of the highest levels of poverty.

Equally, the parts of the country where this seems to be less of a problem, such as the Basque Country, Galicia, and Navarre, are some of the wealthiest regions of Spain.

Housing quality and insulation also contribute to poor energy efficiency, which in turn makes temperature control more difficult. Even among households with high incomes, 15 percent say that they are unable to heat their property sufficiently in winter and 24.8 percent struggle to keep it cool enough in summer.

According to INE data, a quarter (25.1 percent) of Spanish households have not made any improvements to their thermal insulation or heating system in the last year, significantly more than the 14.1 percent who have been able to make changes.

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