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Holiday Rentals in Mallorca (Part 2)

Airbnb and the shared economy

More than 83,000 visitors booked accommodation in Mallorca via Airbnb in 2015. Jan Edwards explores this burgeoning accommodation option.

The other Balearic Islands also have problems. In the 1980s, an owner in Menorca simply applied for a license and it was granted. In 1998, the Conselleria de Turismo introduced strict standards and conditions for commercial property rentals on the island, making compliance nearly impossible. Those who did not have licenses were searched and fined.

In 2004, more realistic regulations were introduced and, although it was still an extremely bureaucratic process, owners of appropriately sized detached villas and fincas – but not apartments – were able to apply for a license. Anecdotally, the Conselleria has been “flooded” with applications and appears to have too few resources available to process them.

“It’s a disaster for Menorca, which has lost tens of thousands of tourists over the last five years,” says Ken Toomey of Menorca Home Care. “Menorca’s tourism market is holiday property rentals, which makes it worse that the hotel sector is so powerful .” In Ibiza, Jesse Jackson of real estate company Stirling Ackroyd says no new licenses will be issued: you can’t buy to rent in Ibiza. And according to a report in El Diario de Ibiza, there is an official campaign to carry out 2,000 inspections this year to detect “illegal offers”.

Even property journalist Mark Stucklin found it difficult to get definitive answers in his Sunday Times newspaper article about Spanish holiday rentals. For the record, as it officially stands in Mallorca, the only properties that can be licensed for commercial holiday accommodation are detached villas and fincas with the required specifications. The license mentioned in the Conselleria’s letter is simply not available to the owners of apartments in complexes legally registered for residential purposes, so these places cannot be used for holiday accommodation, except for family and friends.

Owners who let themselves commercially risk being discovered by vigilant Conselleria inspectors – or being denounced by disgruntled neighbors who want to maintain the complex’s residency status. Community relations can suffer, as can bank balances, with this potentially high fat penalty. The background to the issue of holiday rental licenses is a murky gray one, but it is clear that many foreigners are potentially affected by an issue that is controversial, that is damaging Mallorca’s image in the second home market and is unlikely to go away.

Click here to continue buying property in Mallorca (Part 1)