The supply of short-term accommodation (ACD) in Ibiza has fallen by 23% since 2020 as a result of restrictions and sanctions on tourist rentals. This decline has not managed, however, to slow down the increase in rental prices across the island, which has risen by 19% on average in the last 8 years. This is according to a private report prepared by PwC, which points out that the restrictions have generated a significant impact but not in the expected direction, since a greater reduction of the tourist housing stock does not mean a lower increase in prices.
Quite the contrary. Thus, the municipalities with the greatest reduction in tourist rentals, Ibiza and Sant Antoni, are the ones with the sharpest price increases.
Empty housing, another problem
Another problem pointed out by the PwC report is that in Ibiza there are at least 15,700 empty homes, which represents 20% of the total stock of the island and four times more than the homes for short term rentals or tourist rentals. This figure increases if one considers homes with low or sporadic energy consumption: in that case there would be 21,178 (27% of the total stock). In Ibiza, the 3,892 short-term rentals, including both occasional and intensive rentals, represent 6.44% of the total housing stock, exceeding the national average.
Since 2012, the Tourism Law in the Balearic Islands established strict restrictions, prohibiting short term rentals in all multi-family buildings. Subsequently, in 2017, these regulations were developed, defining different types of short-term rentals depending on their dedication, and the type of building where it is located, again allowing tourist rentals in multi-family buildings under certain specific conditions. In this 2017 amendment, several types of zones were defined based on the use of the land and its level of tourist interest, establishing a limit to short-term rental accommodations and the types of short-term rent als allowed to operate. The governments of each island and the municipality of Palma are responsible for zoning. It should be clarified that regional regulations consider it illegal to rent a tourist dwelling by rooms (the entire property must be rented), although it is permitted in the Civil Code.
Zoning
The report explains that island regulation has not been developed in a uniform manner: “As stipulated by regional regulations, the Ibiza government should have drawn up a plan to define its zoning; however, it has not done so. Therefore, regulation on the island is left to the individual actions of each municipality.” “Ibiza Town Hall has been preventing short term rentals in apartments since they were banned at the autonomous level in 2012 and has not issued licenses since the ban was lifted in 2017,” he adds. While the supply of short-term rentals decreased from 4,758 to 3,892 between 2020 and 2023 on the island, rental prices have continued to rise steadily between 2015 and 2023. In this regard, the report highlights that the municipalities with the largest reductions and the lowest percentages of short-term rentals, Ibiza (-39%) and Sant Antoni de Portmany (-18%), are the ones that also show the steepest price increases: 19.7% and 20.5% respectively. “This suggests that limiting short-term rentals may not effectively curb rental growth,” argues consultancy PwC.
The situation by municipality
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Ibiza
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- Drop in ACD: -39% (from 886 in 2020 to 539 in 2023).
- Rent increase: +19.7% (2015-2023).
- Currently, ACDs represent only 2.3% of the housing stock.
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Sant Josep de sa Talaia:
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- ACD drop: -11% (from 1,706 in 2020 to 1,515 in 2023).
- Rent increase: +19% (2015-2023).
- ACDs account for 9.7% of the housing stock, the highest percentage on the island.
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Santa Eulalia del Río:
- ACD drop: -15% (from 1,263 in 2020 to 1,076 in 2023).
- Rent increase: +19.6% (2015-2023).
- Tourist rentals: 4.7%.
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Sant Antoni de Portmany:
- Drop in ACD: -18% (from 515 in 2020 to 421 in 2023).
- Rent increase: +20.5% (2015-2023).
- Tourist rental: 3.5%.
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Sant Joan de Labritja:
- Drop in ACD: -14% (from 398 in 2020 to 341 in 2023).
- Rent increase: Not specified in the report.
- ACDs represent 7.8% of the housing stock.
Regarding these figures and the freedom of municipalities to set restrictions unilaterally, the recently appointed island director of the Fight against Intrusiveness in Ibiza, Enrique Gómez Bastida, said: “It seems logical that the regulatory authorities can not only exercise their powers in tourism planning, determining where residential use should prevail and where the tourist use should prevail”. “Perhaps what in this report is associated with regulatory failures and without entering into specific assessments on this or that rule, should also be taken into consideration as an element the difficulty of enforcing the rules and fight against illegal supply. And even more so if we consider that the illegal supply of tourist housing harms the legal supply, is unfair competition and affects the quality of the destination itself,” he said on his LinkedIn account.
