Trouble in Paradise..the Canaries rentals clampdown

[Florence]

I have spoken to Holiday Lettings who say that they will remove the advert of anyone who does not have a relevant touristic license.  They have 1,802 properties in the Balearics and 2,147 properties in the Canary Islands and I should imagine that the vast majority (if not all) of these do not have a license.  Instead of sticking to the law (which would affect profits somewhat) they should join the campaign to change it.

[SurfJames]

Good point Florence. They have loads of customers and therefore loads of clout.

It's not for them to decide who can or cannot advertise their Canarian property based on a licence.

(I bet when they work out the lost revenue they'll change their minds  )

Incidently, I've notice a lot of properties getting pulled off these sites by the owners, once they have enough bookings, only to reappear the following spring.

[fifi]

Hi Florence. That is interesting. I wonder if it has anything to do with Government pressure? It happened before with one of the Holiday letting companies.

Also there was an amendment to the law on 26th July  which may or may not affect how companies operate in the future.

Translated by Google.

The amendment is intended to Article 75, is to add a new paragraph (1. Aa) after paragraph 1 thereof. This is intended to describe more clearly and precisely one of the behaviors that can be described as "very serious offense" and is consistent in construction, expansion, reform, rehabilitate or open a tourist accommodation lacking the "requisite "administrative authorization. The provision is mandatory determines when this authorization by reference to the Act to develop the Guideline 27, contained in Law 19/2003 of 14 April, which approved the General Management Guidelines and Management of Tourism in the Canary Islands (currently is pending which will come into force next year).

The amendment in Article 83, is to add a section 3 (currently two) so that tourism businesses can legally give the inspectors tourist personal data that are necessary for the exercise of its powers. Thus we claim the possibility provided in Article 11.2 of the Organic Law of Protection of Personal Data, Article 11.2, which states that whenever authorized by law, we may transfer personal data without consent stakeholders for the exercise of legitimate functions

I have passed on the information to Janet and hope to find out her opinion on this.

My laptop lead is broken and I am waiting on a new one so I am on a borrowed laptop at the moment which will have to be given back soon

[fifi]

I had a quick look at Holiday Lettings terms and conditions.

Reporting Inappropriate Content
If you consider any of the content of any videos, photographs or any other material posted on our site by any Advertiser to be offensive, discriminatory, defamatory or libelous or otherwise inappropriate ("Inappropriate Content"), please notify us of such content by sending us details of the content you consider to be inappropriate and the reason why you consider such content to be inappropriate.

Upon receipt of notification that any content is considered to be inappropriate, we will review such content and shall decide whether to remove such content from the site.

Please send details of any content which you consider to be Inappropriate Content to us:

By email to: videoreport@holidaylettings.co.uk


All the Inspectors would have to do there is to say that most of the properties are illegal and ask for them to be removed. The  illegal letting cases are probably  a nuisance for the company because the Lawyers were trying to suggest  that  information on the holiday letting  websites may not necessarily be accurate etc etc

It would be easier for them to have the paperwork to prove that the properties on their books are legal I guess.

[fifi]

Janet  Anscombe the lady who is leading the campaign has been in touch with me. She was saying that  the big holiday rental websites are getting jittery about the whole thing. She has  spoken with the lawyers from two of them, and a researcher from a third - and they seem to be wondering if  they will be deemed to have a duty of care to those who advertise with them. This is particularly true when they have related magazines or journals which now carry articles about the problem, and of course recently even the British Embassy in Madrid issued a press release warning of it - only 18 months late ...

Janet does not think that  it has anything to do with data protection issues, really, because under Spanish data protection legislation, if the Government thinks an offence has been committed then data protection is waived anyway. This is why those agents who refused to cooperate with the inspectors on the grounds of data protection have received extra fines.

[Florence]

The Advertising websites have a big interest in getting this law amended, along with these other stakeholders:-

Ryanair, Easyjet, Air Berlin and any other airline carrying independant passengers;
Real Estate agents;
Nortysur and other similar shops that sell furniture and linen to foreign property owners;
Tourist attractions such as water parks and the zoo;
Conveyence lawyers and Notaries;
All restuarants and bars;
Taxi and transfer companies;
Supermarkets;

The list is endless and involves practically anyone in the Canaries because somewhere along the line their livelyhood depends on tourism.

[fifi]

I am surprised that there has been so little interest in Fuerteventura to be honest Florence. I think it is a case of "We wont worry about it until it affects our bank balance". There will be mayhem when the complexes that were previously Touristic start trying to set up Sole Agencies. Now is the time to be watching how Tenerife are doing it and learning from their experience. In Tenerife, Business owners, Taxi drivers, and everyone else who was likely to be affected got together to voice their opinion on the matter and because of that some changes are on the way. If Airline routes are not profitable they are soon pulled and most are on short contracts anyway.If there is any fear of litigation I can understand why the Holiday lettings sites would think twice about going against the Spanish Law too.

[fifi]

Hi Florence I sent you a PM earlier. Just in case you emailed a reply to me, I no longer have the Forum email address and so please PM me back via the Forum (in confidence).

[Florence]

I have replied - hopefully you will receive ok.

[Deso]

There is a forum which is a spin off from Janet Anscombs site if anyone is interested.   

http://holisnaps.com/cgi-bin/yabb2/YaBB.pl

[fifi]

There is a forum which is a spin off from Janet Anscombs site if anyone is interested.   

http://holisnaps.com/cgi-bin/yabb2/YaBB.pl

Thanks Deso. Must take a look at that later on.

PS. I cant manage to get into it with the password that was emailed to me for some reason.

[Deso]

Do we know if any fines have been issued in Fuerte as yet?

[fifi]

I have heard of a few. I have only seen one in the Boletins. They only show the cases of people that they are unable to contact. I think the ones so far in Fuerte are neighbours denouncing each other.

[moodyblue]

Whilst I have sympathy for people who bought their apartment / villa on a complex with a veiw to renting and therefore receiving income , please consider those of us who bought our villa in what were told would be a solely residencial street , only to find that because the developer cant sell them he is now renting them out as holiday rentals .
And when you have holiday rentals you undoubtately get lots of very noisy kids and adults who are understandably excited because they are on holiday , but I bought my house because of the location and the fact it was going to be residencial .

[stevecrane]

This is such a difficult issue. Like moodyblue, I don't want a bunch of noisy holidaymakers to be living next door to me all summer. I also sympathise with those who bought with renting in mind. I just don't see how a complex can be changed touristic retrospectively? I suspect anyone with an apartment on a complex will never be permitted to rent short term.

[fifi]

Hi Steve, the changes that are on the way will effect the complexes which once operated with Touristic status. They lost their status when they were sold to private buyers and will once again have a chance of regaining it and operating legally. There are also changes on the way to the sole agency part of the law but it is not clear yet exactly how that will work.

There will be no changes to complexes which were always Residential.

There are no plans at the moment as far as I am aware to start issuing licenses for villas either but a proposal has been sent to the EU and it is expected to take several years before we hear the outcome on that.

[bobbieball]

Maybe if people had declared an income from letting their property  & payed taxes(MANY DIDN'T) the goverment would of realised how much income they can make!!

[lionfish]

I wonder just what percentage of holiday rentals are "illegal"?
It appears to me that any on Residential complexes are automatically illegal, many on the previously Touristic classified complexes are illegal because they don't comply with "the rules", most, if not all, villa rentals are illegal, as the owners have no licence.
If my assumption is correct, most of the tax on rentals which does go to the government is from illegal activities - surely they won't stoop so low as to accept the tax and then fine the owners for renting their property out - or would they?
It will never happen, but I think the best way forward is to declare an amnesty for a period of 4 to 5 years to allow all property owners to get their house in order i.e. to comply with the rules. Tax on all rentals must be paid during that period (otherwise a very hefty fine for tax avoidance). In the meantime the government needs to act to re-licence those properties deemed appropriate for holiday rentals.
If people could pay tax without fear of being fined, even for 4 to 5 years, it would do much to boost the government's coffers. Owners who know that after the 4 or 5 years they will have to stop renting will at least then have time to sort themselves out, maybe even sell up if their property ownership is dependent on rental income.

[fifi]

http://www.lanzaroteinformation.com/content/lanzarote-property-owners-update


Thanks to Spike on Q for this article.

[fifi]

The Lanzarote Island plan is interesting. They are planning to cut the amount of Tourist beds. Quality not quantity seems to be their idea.... http://www.lanzaroteinformation.com/content/lanzarote-island-plan-2012

[fifi]

I wonder just what percentage of holiday rentals are "illegal"?
It appears to me that any on Residential complexes are automatically illegal, many on the previously Touristic classified complexes are illegal because they don't comply with "the rules", most, if not all, villa rentals are illegal, as the owners have no licence.
If my assumption is correct, most of the tax on rentals which does go to the government is from illegal activities - surely they won't stoop so low as to accept the tax and then fine the owners for renting their property out - or would they?
It will never happen, but I think the best way forward is to declare an amnesty for a period of 4 to 5 years to allow all property owners to get their house in order i.e. to comply with the rules. Tax on all rentals must be paid during that period (otherwise a very hefty fine for tax avoidance). In the meantime the government needs to act to re-licence those properties deemed appropriate for holiday rentals.
If people could pay tax without fear of being fined, even for 4 to 5 years, it would do much to boost the government's coffers. Owners who know that after the 4 or 5 years they will have to stop renting will at least then have time to sort themselves out, maybe even sell up if their property ownership is dependent on rental income.

An amnesty like that would have been far better than the way they handled the situation I think Lionfish. Properties which were previously Touristic will be given the chance to regain their status. Some changes are on the way thank goodness.

[lionfish]

Sitting idly yesterday, watching the world go by, my eyes fell on the backs of the properties on Alcalde Marcial Sanchez Velasquez (in Caleta). From the top, Gaudia, Bahia Sol, Puerto Del Sol, Tahona Gardens, (Las Arenas?), Amuley Mar 1 and Amuley Mar 2. Of these, Puerto Del Sol appears to be derelict and Tahona Gardens operates as an tourist hotel complex (therefore presumably "Touistic"?) the other 5 complexes are presumably all "Residential" and most, if not all, will have been built in the last 8 years.
Surely all these complexes, plus many more around Caleta, were  built with the approval of the island planners? If they are for residents only where on earth did the planners think these residents would come from? There is no doubt in my mind that the expectation was for a substantial proportion of holiday letting as very few people would buy a property just for their own holiday use, especially people who work and have limited holidays. I know for a fact that Gaudia was heavily marketed in Ireland with clearly no expectation that the purchasers would become residents.
My view is that the planners who allowed all the over building are largely responsible for the holiday lettings mess, along with the sales people who no doubt advised people of the holiday renting potential as a means of funding a mortgage.
If the fines continue then I'm sure we can all envisage the vast number of unoccupied properties falling into neglect as people hand back the keys and former residents leave the island because they can't get work.
What will the posh 5* A.I. guests think of the island as they are driven past hundreds of derelict properties before they finally arrive at their prison for the week - they surely won't want to go out walking amongst the squalour which will remain after all the other businesses have closed down and owners have left the island?

[Ivemovedon]

Its not just Caleta & other major resorts that will suffer. The rural villages are in danger if this clampdown on licenses extends to private non complex houses, as i would think 99% don't have one. Our village will die a death overnight if it does. All the local businesses - ferreterias, restaurants supermarkets and bars among others will suffer as in my experience around 60% of customers are either holidaymakers, foreign homeowners or the people that work for them. All those that live in the villages including Spaniards who work on these properties will be virtually redundant including gardeners, maid services, electricians, plumbers, pool cleaners and general rental companys  Even now local businesses are finding it hard to survive with some only lasting a few months before closing down. What chance if half the customer base is destroyed in one go.? I really hope it doesn't get to the stage where we will find out the real impact. But unfortunately i think we will.

[SurfJames]

Sitting idly yesterday, watching the world go by, my eyes fell on the backs of the properties on Alcalde Marcial Sanchez Velasquez (in Caleta). From the top, Gaudia, Bahia Sol, Puerto Del Sol, Tahona Gardens, (Las Arenas?), Amuley Mar 1 and Amuley Mar 2. Of these, Puerto Del Sol appears to be derelict and Tahona Gardens operates as an tourist hotel complex (therefore presumably "Touistic"?) the other 5 complexes are presumably all "Residential" and most, if not all, will have been built in the last 8 years.
Surely all these complexes, plus many more around Caleta, were  built with the approval of the island planners? If they are for residents only where on earth did the planners think these residents would come from? There is no doubt in my mind that the expectation was for a substantial proportion of holiday letting as very few people would buy a property just for their own holiday use, especially people who work and have limited holidays. I know for a fact that Gaudia was heavily marketed in Ireland with clearly no expectation that the purchasers would become residents.
My view is that the planners who allowed all the over building are largely responsible for the holiday lettings mess, along with the sales people who no doubt advised people of the holiday renting potential as a means of funding a mortgage.
If the fines continue then I'm sure we can all envisage the vast number of unoccupied properties falling into neglect as people hand back the keys and former residents leave the island because they can't get work.
What will the posh 5* A.I. guests think of the island as they are driven past hundreds of derelict properties before they finally arrive at their prison for the week - they surely won't want to go out walking amongst the squalour which will remain after all the other businesses have closed down and owners have left the island?

Great post lionfish.

The cycle goes round and round.

1.Holiday company screws owner of a complex so hard, that the owner struggles to keep up the maintenance.
2. Tourists stop going because it's run down.
3. Private developer buys up run-down complex, changes status to residential, sells units as holiday homes.
4.Purchasers are prevented from renting, some units abandoned or sold for next to nothing.
5. Complex becomes run down due to fall in maintenance fees.
6. Complex sold to another developer.
7. Go back to 3.

This is possibly a very cynical view of the situation.

For goodness sake AUTHORITIES. Get some common sense. Pass a new law allowing private rentals. Collect more tax and allow the island to become a vibrant place again.   

[fifi]

True enough Surfjames.

[niksternoo]

Hi all, i dont totally understand what has been going on,, but have logged on to this post as have just returned from FUE and heard a few things that were "going on".  Our apartment that we rented is managed by a company who clean and rent out the apartments on the owners behalf and one of the staff told us that "officers" of some kind were on the island whilst we were there to catch out the owners who were renting that dont pay tax.  We were asked to say by staff member that we are NOT renting but that we are merely borrowing/gifted the apartment from a relative.  One person had been caught out in Caleta (according to staff member) that week and was fined 18k.  Obviously i was concerned that should the owners of the apartment we had rented not paid this "tax" the we would be chucked out.  I was told that would not happen, but reading post above it looks like it could happen.  I spoke to an owner of another apartment in our block and she said that she pays her tax and it as less than 300 for a large 3 bed apartment per year.  So if the amount is so small, why wont people pay it? surely you can recoup it through renting? Surely its not worth taking the risk of being fined such a huge amount?  or am i totally reading this wrong and there is much more involved? if so i apologise, as i said i have not read the full details of the subject in the links people have posted.  So now it leaves me with the question that if we book again for ext year how do we know if the owner has paid their tax and if not what is the likelyhood that we will get chucked out of apartment?  all sounds a bit risky to me, which would be a shame if this is true as we really want to return next year as we loved FUE. 

[Florence]

Hi - it is not a simple as owners not paying tax.  The owners would love to be legal and pay tax (and some do pay tax on their property in the UK) but as the authorities are not issuing licences and this forces the owners underground.  The company mislead you somewhat as the issue is with licences - not tax (although that would follow on).  Most owners pay a non residency tax anyway (I did).

[moodyblue]

I visited my lawyer today in Caleta to discuss how I could stop the properties on my development being let out to holidaymakers on short term holiday lets , she has advised that in the first instance she sends a letter to the offending party asking it to stop because it is illegal , if that does not work she will then have a denuncia served on them.
She told me that the authorities in Fuerteventura are beginning to clamp down on such illegal letting , and she had two such cases on her desk that she was defending , one owner had been fined €60,000  yes sixty thousand euro , she thinks that there is going to be a lot more similar cases very soon .

[fifi]

Thanks for that interesting bit of news Moodyblue.
The fines can go up to €300,000.  Most  private owners are fined €18,000 per property if it is a first offense and Letting agents  are usually fined around €60,000. Second offenses are considered more serious and the fines increase then.

[lionfish]

I find some of the content of Moodyblue's post a bit concerning. If he is disturbed by noisy holiday makers I have every sympathy. We have just returned from a long stay in our own apartment and found the whole complex extremely noisy, as it is most summers. BUT, most of the noise comes from Spanish (and other nationalities) children who are on holiday from school and their parents/Grandparents who supervise them around the pool. These are residents, not holidaymakers. There are also Spanish families who own properties on the complex and use them just for holidays. Yes, there are some British holiday makers and yes, they do make noise, but generally far less than the residents!
It has been mentioned in other posts that following a denuncia complaining about holiday rentals there is a good possibility that this will attract "the inspectors" and lead to fines for the owners. I supose Moodyblue's lawyer will be happy to appeal against the fines on behalf of the owners? Nice little earner if I may say so:- issue a denuncial, get the owners fined and then defend them against the fine - quids in!
My big concern is that all these fines will lead to empty properties, closed businesses and a deserted island apart from retired pensioners who can't go out for a meal because the restaurants are closed, can't do any food shopping because the food shops are closed, can't repair their properties because the ferriterias are closed etc. Is that what we want?
One only needs to look around most complexes in Caleta to see the number of vacant properties already and that is before the inspectors really get their teeth into Caleta.
Before any one thinks I have a personal axe to grind, we own our apartment outright, so we have no mortgage to fund and we use it ourselves for around 5 months of the year. We also have two couples who are longstanding friends that we allow to use the apartment for a total of 6 to 8 weeks each year. We do not take any money from them, so hopefully this will not be seen as "holiday rental".
Yes, we do also pay our non renting taxes and all other dues.
Yes, we would like the complex to be quieter, but we realise that this will not happen as long as it's the residents who are making the noise!