Balancing Homes and Holidays: EU Debates Housing Rentals and Consumer Rights

The housing rental has become a central discussion in Europe and so are the debates about the issue in the institutional headquarters. Recently, some mayors were invited to the EP to talk about housing rentals in the internal market and consumer protection commission. The hearing featured two panels: the first examining the current regulatory framework and challenges in housing rental, and the second presenting perspectives from key stakeholders.

Challenges in Housing Rental: Perspectives from City Leaders

Madrid’s Mayor, José Luis Martínez-Almeida Navasqües, emphasized the need for a sustainable housing supply, stating that Madrid is making more land available to ensure housing costs remain at 30% of income. He acknowledged the pressure exerted by tourism on the housing market, advocating for increased supply and adaptability in building use.

Barcelona’s Mayor, Jaume Collboni, highlighted the rising cost of housing in his city, where prices have surged by 68% over the past decade while purchasing power has grown only by 16%. He underscored the need for EU frameworks to guarantee access to affordable housing and called for social housing funding. Collboni outlined measures taken in Barcelona, such as limiting rent increases, halting new tourism licenses, and combatting fraud in short-term rental contracts. He supported the Short-Term Rentals (STR) regulation but insisted on further European-level action.

Expert Insights on Housing Affordability and Regulation

Sorcha Edwards, Secretary General of Housing Europe, pointed to insufficient funding as a root cause of the housing crisis and stressed the need for public funds to be directed towards genuinely affordable solutions. Amaryllis Verhoeven, Head of the Digital Transformation of Industry unit at DG GROW, addressed the affordability initiative aimed at driving innovative housing solutions. She highlighted the significance of short-term rentals in the platform economy and the necessity of property registration transparency. She also discussed taxation measures to ensure platforms collect VAT and contribute to a fairer economic landscape.

Katharina Knapton-Vierlich, Head of the Construction Unit at DG GROW, spoke about increasing housing supply through construction, while Professor Claire Colomb of the University of Cambridge presented findings from a study analyzing short-term rental regulations in various cities.

MEPs Debate Short-Term Rentals and Housing Policies

During the exchange of views, several Members of the European Parliament expressed concerns about short-term rentals and their impact on housing availability. Irene Tinagli raised the issue of distinguishing between tourism rentals and regular housing. Pablo Arias Echeverría inquired about Madrid’s stance on short-term rentals and potential tax incentives, while Laura Ballarín Cereza praised Barcelona’s proactive measures. Klara Dostalova questioned how to ensure that permanent housing remains designated as such. Pierfrancesco Maran stressed the importance of constructing more affordable housing, and Stefano Cavedagna emphasized the balance between protecting private property and incentivizing long-term rentals. Other MEPs discussed the risk of over-regulation and the challenge of maintaining transparency while allowing for local flexibility.

In response, Madrid’s Mayor expressed concerns about ineffective regulations and the need for wage increases. Barcelona’s Mayor called for greater financial support for major cities, insisting that prioritizing residents in high-demand areas is crucial. Claire Colomb noted that regulating one sector often shifts investment into another, complicating market dynamics.

Stakeholder Perspectives on Short-Term Rentals

The second panel focused on stakeholders’ perspectives. Viktorija Molnar of the European Holiday Home Association defended short-term rentals, arguing that they are part of a broader housing challenge and that data-driven approaches are key to managing urban issues. She cautioned against outright bans, citing New York City’s experience with short-term rentals moving onto social media platforms.

Mark Boekwijt of the European Cities Alliance on Short-Term Rentals expressed concerns about regulatory enforcement and the lack of transparency from rental platforms. Barbara Steenbergen of the International Union of Tenants warned that short-term rentals contribute to gentrification and rising rents, calling for firm regulation to protect long-term tenants. Kai H. Warnecke of the International Union of Property Owners argued that housing issues should be addressed at the city level, rather than through broad EU legislation. Domenico Campogrande of the European Construction Industry Federation highlighted the Green Deal’s implications for the housing sector.

Finding a Balance Between Regulation and Market Flexibility

During a further exchange of views, MEPs debated the tensions between property owners and tenants. Some argued for a wait-and-see approach until data from the STR regulation becomes available, while others emphasized the urgency of action. Suggestions included requiring building-wide approval for short-term rentals where owners and long-term tenants share the same property.

The hearing underscored the complexity of balancing housing availability, affordability, and market regulation. As the EU continues to develop its policies, cities, stakeholders, and lawmakers will need to collaborate to ensure that both residents and property owners benefit from a fair and transparent housing market.