So... Airbnb... The answer is no.
The truth is with us at Valencia Property the answer has been no for some time in the vast majority of cases especially since we opened our Stepping Stone Rentals sister company. But we can no longer look on and shrug our shoulders as Airbnb has such an effect on the housing market around the World and more specifically Valencia.
We have been writing on this blog for years about the End of the Airbnb Economy, the fact that Airbnb isn't as profitable as people think and more. We actually started calling for people to stop buying places to Airbnb in 2018 as it was having too great an effect on the city. In 2019 we welcomed the end of the Airbnb economy (Which was temporary) as there were huge benefits for the city and its people when the restrictions were imposed. Then along came the pandemic and in 2020 Airbnb stopped for a few months before booming as restrictions on them were lifted. At the end of 2022 that slowed up and as our focus wasn't on Airbnb we reported that we hadn't made one sale of a property to rent out on Airbnb in the whole year. We directed our clients elsewhere. Most Airbnbs from 2022 onwards were ground floor commerical units which were converted into Airbnb use but remained commercial. That year we did make plenty of sales for medium and long term rentals. This year we reported on the increasing difficulty of finding a place to buy in Valencia and yes, it's brutal out there and a lot of that is to do with Airbnb.
As you can see from the above we have never been great fans of Airbnb and have largely put off people who wanted to buy properties to put into exclusive Airbnb usage. This week though after the large protest last weekend which we talked about last week there was a discussion in the Asicval group (The Association of Estate Agents in Valencia) about the market in general and what we as Estate Agents can possibly do to help stem this outflow of properties from the use of the population as a whole to the use of a restricted number of tourists using Airbnb. So we have decided at Valencia Property that we are going to take a stand at least.
We will no longer be working with any clients who get in touch with us wanting to buy for Airbnb usage. We will have a stock response which says:
"No. Sorry but we cannot work with you".
Here is how it happens. Potential clients contact us after seeing one of our properties online and they ask us whether it would be suitable for short term rentals. For the last two years we have generally been answering and offering them the possibility of doing medium term rentals through our sister company Stepping Stone Rentals or normal long term rentals but where there was a possibility we have told them yes, you can buy it but we don't offer services for short term rental. We will no longer be doing that because it reduces the number of properties available for our other clients looking to live and work here and contribute more to Valencian society day to day.
As estate agents with years of experience in the property market, we have seen various trends come and go. and Airbnb has probably been the biggest game changer in the market; not the Golden Visa, not the lack of building, not the popularity of Spain as a destination to live, but tourism and a lot of that tourism comes from Airbnb. Initially, we embraced this trend, believing it could provide homeowners with opportunities after the great financial crisis post 2008 and truth be told, it did. However, after careful consideration and extensive observation over the last few years, we have made the decision to stop selling properties to individuals looking to invest in real estate for the purpose of operating Airbnb-type holiday rentals. Here are the reasons behind this decision.
Community Impact
One of the most pressing concerns about short-term rentals is their effect on local communities. As properties are transformed into tourist accommodation, the sense of community diminishes. Neighbours, who once knew each other have become unfamiliar faces in many parts of the city, leading to a lack of cohesion and businesses in the areas effected are closing down as they no longer have regular customers. Long-term residents are often displaced, particularly in neighbourhoods that have become tourist hotspots. This disruption to the fabric of our communities is something we can no longer support in good faith.
Housing Affordability
Airbnb and similar platforms are inextricably linked to rising rental prices in most urban areas. By removing units from the long-term rental market, property owners contribute to a scarcity of available housing, driving up long-term rental prices for local residents and people looking to move here permanantly or simply making the supply non-existent. This is particularly troubling in popular cities where affordable housing is already in short supply. As estate agents, we believe it’s crucial to prioritize sustainable living environments over short-term profit in order to maintain the look and feel of the city that make it so attractive to live in the first place.
Regulatory Challenges
The regulatory landscape surrounding short-term rentals is becoming increasingly complex. Many cities have implemented strict rules governing short-term rentals, including licensing requirements, insurance, and limitations on the number of nights properties can be rented. As regulations continue to evolve, investors could find themselves facing legal battles and potential fines. The uncertainty surrounding these regulations makes it a risky investment strategy that we cannot endorse. If Airbnb is your option then we don't want to sell it to you anyway but we must let it be known that the risk associated with it in many cities now is too great anyway.
Impact on Neighbourhood Safety
Short-term rentals sometimes contribute to safety concerns in residential areas especially of older generations. With a rotating door of guests, it’s challenging for the people living in the community permanently to establish a sense of security. Instances of parties, noise disturbances, and potential criminal activities associated with transient rentals (Drug Taking, too many guests etc) can lead to tensions within the community. As agents who value the safety and comfort of our communities, we find it troubling to facilitate investments that could undermine this stability.
Market Saturation
In many areas, the market for short-term rentals has become saturated although on looking at how many people still want to do it you wouldn't think so. As agents, it’s our responsibility to ensure clients make informed decisions about their investments, and the risks of market saturation cannot be ignored.
Environmental Concerns
The environmental impact of short-term rentals is another factor that weighs heavily on our collective consciences. Increased foot traffic in residential areas can lead to higher waste generation and strain local resources without contribution to solving those issues through taxes or even basic hygiene at times on behalf of the guests. Just a couple of weeks ago a neighbour filmed someone who had managed to lock themselves out of a ground floor rental deciding to urinate against the wall next to their door. Moreover, and more importantly long term, the carbon footprint associated with short-term tourism, think of increased transportation and energy use, contributes to climate change and Valencia aims to be a Carbon Neutral City by 2030. As we move toward more sustainable practices, we feel compelled to advocate for investments that give a greater priority to environmental stewardship and that means longer stays through medium and long term rentals .
Legal Liabilities
Short-term rental operators face various legal liabilities, from guest injuries to property damage to class action suits from the communities affected by their property becoming a party house (This has actually happened in Valencia and the owner of the property was forced to sell it to pay reparations to the other apartment owners in the building, moral damages was one of the reasons given in the judgement). Even with insurance, the potential for costly lawsuits may loom in the background. Many investors are unaware of the legal implications of renting their properties short-term, exposing themselves to significant financial risk. As agents, we have a responsibility to ensure our clients understand these risks, which is increasingly difficult in the context of short-term rentals. If there's a problem you can avoid then our suggestion is to avoid it.
Ethical Considerations
Finally, there’s the ethical dimension. As real estate professionals, we have a responsibility to consider the long-term implications of our actions. Supporting short-term rentals has been proved to directly contribute to broader social issues, including gentrification, exclusion, the erosion of community identity and lack of opportunity for younger generations. All of us at Valencia Property have kids and recognise this. We believe in a real estate practice that uplifts communities and promotes more sustainable living, and short-term rentals often stand in stark contrast to these values.
As agents, we are often perceived to be the cause of the problems when the truth is so far removed from that it's on a different continent. Speculation, owners taking the p*ss, money laundering, naked greed and the actions of investment funds and big builders wanting to maximise profits for shareholders are much worse and have a much greater effect on the property market. Agents reflect what is available but we have to put up with being handed the blame. Only last week we recieved the following lovely message.
I was very tempted to answer of course but know that it was a fake email address and number so it wasn't really worth it, but keyboard warriors have to keyboard warrior we know. (The place he mentioned had sold two days before at asking price to a local buyer so it wasn't as bad as he claimed. Judge for yourself) This property is much better by the way. However, I sort of understand the sentiment. There is anger out there as exemplified by the protest in Valencia last week and the previous protests in Barcelona and Madrid, and that's because we live in the society we live in and things are as they are.
However, if we can make even a slight difference in the market and hope that others follow suit later then maybe, just maybe, a small change in the direction of travel can be effected. A small step on the way is to at least fight for what we believe in and that is to not work with people looking to "Invest" for Airbnb purposes in the name of a quick buck.
We are quite happy to work with people wanting to buy and rent out long term as there are so few properties available and this would help people in the market looking for somewhere to live but as we have said before on these pages our advice is always the same, put your rental price below comparable properties and you will get not only a good selection of tenants but also good tenants who want to stay and pay the rent.
Finally, if you are one of those people late into the Airbnb game but still wanting to do it then I'm sure you won't have problems finding agents willing to work with you. It just won't be us.
Villa Of The Week
Back in the early 2010s just after the financial crisis there were various crazes about in house construction for any builder that hadn't gone bankrupt and they can be summed up as follows;
- 4/3/2/1 houses (No, not Terry Venables Xmas tree formation, you're still thinking of the earlier Euro 96 version there) Just 4 bedrooms and 3 bathrooms on 2 floors and 1 pool and plot.
-Colourful shiny bathrooms
- Matt coloured outside walls although I can't decide whether this one is grey or blue (The blue might be a reflection of the pool)
- Less work. Meaning a garden that is easy maintenance
- Columns
- Roman steps into the pool
- High white walls surrounding the house to reflect light inwards at all times.
-Plenty of off road parking in a straight line to the side of the house.
This house could well be the greatest representation ever seen of all of these characteristics of the time. In future years I suspect historians will set it up as a museum to post 2008 villa building styles... unless...
You buy it and change it. To tell the truth there are only two things I want you to change here and they are both bathrooms, the red one and the purple one. And yes that is as bad as they sound.
In the case of the red one we don't get a muted red, not a restrained maroon or even a powdery chalk red...No no no, we get full on "let's induce ultra high blood pressure and potentially a heart attack" red, basically a thing that shouldn't be happening whilst showering or doing the necessities that a bathroom allows you to do. The purple one? It's just nasty these days. Historians can probably date that to the week that it was in fashion in 2010 when this was built. Oh and you might want to change some of that putting green asatroturf for something a bit more natural and potentially muddy, or is that just me?
Anyway, there's a lot to like here. manageable plot, good size, well located, price and looks really smooth... except for those bathrooms. I can even still go with the kitchen
If You Liked This...
Then either read some of our previous pieces about Airbnb linked to above or click on the images below to be given more information about our philosophy, our services and what we can do for you.
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