Legal Guide

How to Rent Holiday Homes to Tourists in Ibiza.

(Photo: 123rf.com)

The houses and villas that already have the tourist license, maintain all their rights and can operate as usual.

Five scenarios facing the tourist rental sector. In July a new law will change the rules concerning house rental to tourists on the island.

The confusion caused (often undertaken with an interest by political parties and influential institutions connected to holiday rental companies) has been forced to clarify what will be legal and illegal this summer. 

Here are five different assumptions:

1 – Properties already registered with tourism licence: can continue to rent as usual.

For the owners of detached houses and apartments in tourist buildings that have already obtained the authorization from the Tourism Council to dedicate itself to the holiday rental sector, the scene does not change too much. There is a new penalty system, but in general, nothing else changes. Although some political parties and associations linked to holiday rentals, have said that with the new law (which will be soon approved by the Parliament) these types of owners will lose their rights and will not be able to rent – the truth is that the legal text maintains this right by not applying the new regulations retroactively. 

2 – Apartments in multi-family buildings with residential use: neither could not, nor can not be rented in the future.

In this group are those blocks of flats that have multiple apartments on each floor (for instance flats with numbers like 2b, 3c). Recently, we’ve seen residential buildings that are dedicated to receiving tourists for days or weeks – it happens more and more often. For these owners the reality is that the starting point does not change at all this summer. Neither could they legally rent to tourists before this law comes into action, and nor can they rent to tourists legally now, as it’s forbidden by the government law Bauzá (PP) approved in 2012. The only thing that changes for this summer, is that the illegality becomes even more clear. Before, with the Bauzá law, it was forbidden to market these type of properties through a tourist channel, (even though it was not defined what was a tourist channel actually was) this created an ideal loophole for those who wanted to skip the law. Now, to clear the doubts, the team of Barceló defines in the new legal text what is a tourist channel, just like an online or actual person working as real estate agency.

It will be harder to skip the law.

In addition, the new regulation incorporates another barrier that will already be in force as soon as the law is approved: only the flats with a tourist registration number can be rented. The new regulations also forbid to websites and rental agencies to promote properties that do not have the license from the Tourism Council. All these developments are in force from the very moment the law is approved. So that the rent of that 2b or 3c of which we speak is not only prohibited, but now it is also easy to penalize with fines ranging from 20,000 to 40,000 euros and that will affect both the owner and those who promote this unauthorised property to tourists.

3 – Apartments in multi-family buildings that want to legally rent: they must wait for the zoning.

The flats in residential buildings that would like to be legally rented, can do so once three assumptions are met: first, that they will need to be approved by the amends of the Pact, which is scheduled for late June or early July (current law of PP does not allow any rent of flats in residential multi-family buildings to be rented to tourists at all). Second: when the so-called ‘zoning’ is complete. This means, the municipalities and councils will define which areas can be rented to tourists and with what quotas. Third, if the first two assumptions are met and the flat is in an authorised zone, it must comply with a series of technical and quality requirements, ranging from the existence of individual water meters and access for people with reduced mobility (walkways, elevators). To the permission of the community of owners to rent to tourists (approved by majority of the neighbours, that is to say over 75%, and not unanimously).

4 – For flats that want to rent to tourists using the LAU: it will be almost impossible.

The LAU allows renting flats for hours. This regulation is still valid and is statewide, so anyone who wants to rent their apartment to tourists with the LAU as a base can do it, but the reform also makes this option difficult. First because in the new Balearic law is considered tourist any rental of less than a month, so that who rent for less time should do so with a tourist registration number or prove that who stay is not a tourist. And secondly, even if the contracts to tourists are made under the LAU, the owner can not market through channels like AirBNB or HomeAway without being exposed to a sanction of between 20,000 and 40,000 euros. In other words, if you have a flat and want to rent it to tourists you should do it for more than a month and without promoting it through tourist channels.

5 – Isolated or detached houses that are not registered yet and wish to do so: if they are legal, they can do so before the law changes.

With the current law, isolated and detached houses, if they meet minimum requirements, can be rented to tourists, after obtaining a tourist licence. Many of these type of properties have done so: they are all those that included in the assumption 1. But there are others that haven’t done so yet, because, in many cases, they lack of certificate of occupancy or are irregular constructions on rustic soil: these kind of properties will continue without having legal permission. On the other hand, isolated or detached houses with a regular certificate of occupancy will be able to operate in the rental market when they present the Tourist Responsible Declaration of Tourist Activity (Driat) and pay the fees. There is no moratorium of any kind, so that Driat can be presented without problem before the new law is approved within a few weeks. Then things change: only the Driat can present those who are in an area authorised by the Council (with which we will have to wait for zoning) and the owner must present a document from his/her council that proves that his house is in an area authorised for tourist rental. This process is identical to the one that will be done in multi-family residential buildings

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