Short-term letting to tourists of accommodation that is suitable for long-term rental is contributing to the shortage of homes. The lure of higher rents and the avoidance of the legal obligations imposed by long-term tenancies are two drivers of the trend.
The Government estimates that 12,000 of the 30,000 short-term tourist lettings on the market are long-term residential accommodation and as part of its Housing for All strategy it wants to get these properties back onto the market.
Its weapon of choice is the planning system via the creation of a short-tern tourist letting register. Anyone offering accommodation for 21 nights or less will have to register with Fáilte Ireland or face fines of ¤5,000.
Registering landlords will have to show they have planning permission for short-term letting. If not, they will have to seek planning permission for change of use or exit the short-term market unless they want to risk fines and prosecution under the planning laws. Many will not be granted change of use, the government believes.
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Despite being announced in December 2022, the Registration of Short-Term Tourist Letting Bill is only now due to come before Cabinet for approval. The delay speaks to a push back from the tourism industry which emerged into the open this week when a coalition of bodies wrote to the Taoiseach warning of the consequences of removing a significant amount of short-term accommodation. They believe up to 6,500 holiday lets on the Wild Atlantic Way could be “lost”.
The true impact of the measure – both on tourism and the shortage of housing – is hard to predict. Similar measures in European cities have had the desired effect of increasing the long-term rental stock but the unforeseen risk to the tourism sector, particularly outside of major urban areas, is not trivial.
With an election due by next March, the Government must be tempted to offer some concessions to the tourism industry but must avoid watering down the initiative to the point where it does not have any significant impact.