As Fuerteventura continues to attract investors, new regulations are reshaping the holiday housing sector.
Olga Gargallo, a tourism entrepreneur specializing in vacation rentals, acknowledges the mixed implications of the recently implemented Canarian Law on Sustainable Planning of the Tourist Use of Housing. While she identifies positive aspects within the legislation, she also underscores its likely impact on the market dynamics.
Enforced since last December, the law introduces critical changes, including a proposed one-year moratorium to allow holiday homes to adapt to new licensing requirements. One of the law’s most contested elements is the transfer of license processing authority to local town councils. Current estimates suggest that out of the 70,000 holiday homes operating across the Canary Islands, only around 9,000 may remain compliant with the new regulations.
In La Oliva, one of the municipalities in Fuerteventura, there are approximately 15,000 vacation rentals, with a target to reduce this number by 90%. Gargallo questions how such drastic reductions will be feasibly implemented.
Gargallo highlights four primary areas of impact stemming from the new law: sector regulation in response to increased vacation home supply, economic consequences for property owners, changes within the real estate market, and social and environmental dimensions. She notes that a concerted effort toward modernization and regulation could yield positive outcomes such as greater professionalism within the industry and a reduction in price speculation.
As the owner of Lovely Property, which manages 38 holiday rentals in Fuerteventura, Gargallo emphasizes her strict adherence to all existing regulations. She believes that companies that have proactively modernized operations—embracing digitalization and optimizing workflows—will fare better than those that have not adequately prepared for compliance.
Despite her professional commitment, Gargallo expresses concern about the potential financial impact of the new law. However, she argues that regulation is essential to ensure fair competition and prevent the illicit rental of spaces not intended for tourist use, such as terrace roofs or converted garages, which could result in fines up to €30,000.
Gargallo notes another anticipated positive outcome of the law: curbing speculation in housing prices. Many property owners initially purchased homes as investment opportunities. If tourism rentals become less feasible, and uncertainties surrounding long-term rentals persist, the market may see a reduction in property sales, subsequently stabilizing prices.
Experts warn that many owners, deterred by legal ambiguities surrounding long-term rentals, may choose to either close their homes or sell them, potentially increasing market supply but not necessarily providing rental housing for families in need.
Community groups are also advocating for transparency regarding vacant properties and calling for measures that guarantee secure rentals and the development of social housing. The law does indeed contain a social aspect, requiring unanimous consent from homeowner associations for any tourist use of properties within their buildings.
However, the law places considerable regulatory responsibility on local municipalities, which may suffer from an increased bureaucratic burden. This creates the potential for delays in license approvals, resulting in additional costs and complications for investors.
On the environmental front, property owners are encouraged to enhance the sustainability of their homes. By incorporating low-consumption appliances and pursuing renovations aimed at energy savings and improved waste management, they seek to align with modern ecological standards. Gargallo conveys optimism about achieving environmental goals and fostering community investments in infrastructure surrounding these properties.
Ultimately, Gargallo advocates for a balanced perspective: “Instead of focusing solely on the law’s merits or drawbacks, we should unite to promote higher-quality tourism in Fuerteventura—a goal beneficial for all stakeholders.”
As the discourse around illegal holiday homes continues, the Ascav employers’ association asserts that many of these properties, though lacking formal registration, are not inherently illegal. They emphasize that any regulatory changes will primarily affect the property marketing channels rather than the availability of homes for local residents.
Image credit: www.diariodefuerteventura.com
Source: www.diariodefuerteventura.com.
Curated by Fuerteventura Times Real Estate Desk.
