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Will Spanish tourism gain by regulating private holiday property rentals
The trend towards cheaper tourism affects Spanish hotels
The review of 2014 in the Spanish tourist sector which was published this week by sector body Exceltur contains many interesting points, not least among which is the growing tendency for many visitors to Spain to stay in unregulated rental accommodation.
This is seen as leading ultimately to less money being spent in Spain by visitors to the country, and encouraging “cheap” tourism through “unfair competition” to regulated establishments such as hotels, campsites and registered tourist apartments. The growth in this kind of tourist accommodation can be illustrated by a simple question of numbers: while the number of foreign visitors Spain grew by 7.1% last year to almost 65 million, the number of nights stayed in registered tourist accommodation rose by only 2.8%.
There are two possible explanations for this: either those visiting Spain stayed for fewer nights, which probably accounts for some of the discrepancy, or they stayed in non-regulated accommodation. This second theory probably accounts for most of the difference between the two growth rates.
Those staying in non-regulated accommodation are estimated to have spent only 67€ per day during their visits to Spain, whilst those in hotels and other registered accommodation disbursed an average of 114€ every day, according to Exceltur.
This is a complicated issue. Of course some income received from rentals is not declared by homeowners, and this is both illegal and harmful to the economy, but at the same time the proliferation of private rentals is simply a function of demand from visitors hoping to come to Spain in the most economical way possible and the increased use of the internet to facilitate holiday bookings.
The trend towards cheaper tourism is one which is discernible throughout the Exceltur report. Although of course it is desirable from one point of view that those visiting the country should spend more money here, care has to be taken not to raise the cost of coming to Spain and thus dissuade tourists from selecting Spain.
Hotel owners of course demand that cheaper alternative accommodation should be removed from the equation since it provides competition, but if those cheaper options were to be removed the consequences are not easy to predict. Certainly some visitors would upgrade their accommodation (although as a result they might spend less on other things while in Spain), but at the same time other tourists might simply not come.
It’s also important to take into consideration that in some regions of Spain residential tourism plays a huge role in the local economy: a foreigner buying an average property is spending 150,000 euros for example before they even start, fuelling the construction sector and all the trades and jobs associated with the construction of a property. Add to this the money then spent on furniture, white goods, soft furnishing, lighting, insurance, etc etc, most of which is also going into the local economy, and the figure can easily increase by a further 10-15,000 euros.
So when the owners of the apartment travel out to stay in their own property and are labelled as “tourists who don´t spend very much” this is an inaccurate reflection of their status, as they continue to spend in local restaurants and local businesses, and they in turn generate extra revenue when friends and family choose to stay in their own, family owned accommodation: they are not staying in “illegal” rental properties, simply those owned by foreigners.
Of course, there are some who rent out their properties illegally, but the numbers are relatively low and it has to be questioned whether this “type of tourist” would consider staying in hotels if legislation prevented the private rental of apartments or would simply select another country where they could easily pre-book an apartment on-line.
Regulation of the rentals sector is undoubtedly important, but regulation doesn´t necessarily have to mean suppression.
And whether Spanish tourism would end up winning or losing is impossible to quantify.