Rainer Sturm/ www.pixelio.de

Majorca is struggling to deal with a huge influx of visitors, with numbers increasing each year. There is a shortage of affordable housing in the main urban areas, a situation similar to that on the mainland. In an attempt to stem the flow of rented properties being let out to tourists—meaning that these properties then are then missing from the normal rental market—the Balearic government has for some time now been working on a new set of regulations to address this problem. At the beginning of September, they finally passed new legislation governing the letting of properties for tourism. The key changes are as follows:

First of all, a moratorium of one year has been imposed on the issuing of new licences. It is now forbidden to let out flats, even if you have a licence, until the responsible local authorities have issued details of the zones in which such rentals are to be allowed. As far as houses as concerned, there is for the time being no change, whether they are detached or terraced properties, as long as the owners are in possession of a licence. This will continue to be valid even if the property is not located in a prescribed zone.

There are also plans for the letting out of flats to holidaymakers to be allowed for 60 days per year, with the following stipulations: the flat must be the main place of residence of the landlord, it must lie within one of the prescribed zones and, if the property is jointly owned, the majority of the owners must have given their consent to the property being let. The goal here is to strengthen the sharing economy and to offer an opportunity for low income groups to top up their income.

The moratorium of one year also applies here when it comes to applications for licences. No further applications may be made before this period has expired.

In an attempt to prevent property speculation, the new law restricts owners to letting out a maximum of three properties.

The local authorities now have 12 months’ time to draw up the boundaries of the new zones, to determine which zones properties may be let out in and for how long. Some districts will in any case apparently be classified as being “in a state of housing crisis”; in these areas, all types of holiday lets will be forbidden as these are areas where the old-established population has difficulties finding access to housing.

It will in future only be possible to apply for a licence within certain designated zones.

When a licence is issued, a register number will be allocated to the licence holder and this must then be quoted when advertising the property on platforms such as Airbnb. If the register number is not quoted, the landlord may be fined up to € 40,000 and the platform itself can face fines of as much as € 400,000.

There will be no increase in the total number of licences to be issued. In future, it will only be possible to apply for a new licence if an old one is being surrendered. At the last official count, there were 435,707 licences in existence in Majorca. It is likely that the upper limit will be set below this figure.

In order for a new licence to be granted, there have up to now been certain requirements, such as the presentation of a certificate of habitability, the taking out of a personal liability insurance policy covering an insured sum of at least € 300,000, a modernisation plan, an energy certificate, etc. This will in all probability continue to be the case.

The effect of the new law can already be seen on Majorca – in the light of the steep fines which they may face, the first cases have been witnessed of landlords cancelling bookings made by holidaymakers.