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TOURIST LICENCE - MORE RESTRICTIONS

Posted: Wed Aug 14, 2019 1:23pm
31 replies3918 views13 members subscribed
Byron

Posts: 25

25 helpful points

Location: Cabo Roig

Joined: 26 Feb 2018

According to an owner in our development, the following is now required/allowed by recent changes to the law regarding the compatibility certificate (Tourist rental licence)

1. A community can object and block an application for a licence. (They cannot insist that existing licences are revoked)

2. The licence number must be displayed on the front door.

3. Communities can vote in a general meeting to require owners who are renting to pay an extra 20% community charges.

With regard to 3 above, my agent/keyholder recently informed me that a neighbouring community voted to do exactly this at their last AGM.

Anyone confirm that the above is correct? How does one keep the right side of the law when such changes are made?

When I heard about the requirement for a tourist licence I said that this is the thin end of the wedge, and once such licences are introduced, the conditions can be changed and additional restrictions and costs imposed, e.g. what if an expiry date is introduced? Owners who have bought with the intention of renting and maybe even depend on the income to support the financing of the property may well find it impossible or uneconomical to keep the property. This could give rise to an even greater dumping of property on the resale market which is already saturated with unsold properties. Property values could plummet, causing another slump. Any estate agents on the forum care to comment? Are you telling your clients the truth about renting? The estate agent that sold us our property certainly didn't mention it. Estate Agents; don't you think that the honest and professional thing to do is to tell your clients about all this?

Movingon

Posted: Wed Aug 14, 2019 1:53pm

Movingon

Super helpful member

Posts: 1857

1607 helpful points

Location: Albatera

Joined: 7 Feb 2018

Posted: Wed Aug 14, 2019 1:53pm

Not defending estare agents, IMO a thoroughly disreputable lot by and large, but I don't understand why it is you think its encumbent on them to educate their clients, that's not their job either legally or morally. 

Anyone thinking of buying a property in Spain - or anywhere abroad for that matter - be it for renting or otherwise should do their own homework and go into it both informed and with eyes open, not rely on others to point out the pros and cons either before or all to often after the fact. 

Byron

Posted: Wed Aug 14, 2019 1:59pm

Byron

Original Poster

Posts: 25

25 helpful points

Location: Cabo Roig

Joined: 26 Feb 2018

Posted: Wed Aug 14, 2019 1:59pm

We have our tourist licence and access to the police database and log all our guests with the police, so we are fully compliant. I am just irritated by the ability of the community of owners to block an application and to have the ability to increase my community fees by 20%. They are already one of the highest in the region. If I knew then what I know now, I would have given property ownership in Spain a wide berth, but we did it so have to make it work. We love it when we're at our apartment, and stress about it when we're not!

Cheryl

Posted: Wed Aug 14, 2019 3:40pm

Cheryl

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Joined: 8 Jun 2017

Posted: Wed Aug 14, 2019 3:40pm

Hello Byron, I understand your frustration but holiday lets are causing problems worldwide and Spain are not the first to act on it, think St Ives in Cornwall where new builds can only be sold to full-time residents and other areas in UK where lets are supposedly limited to 90 days a year.

Not all owners are as conscientious as you and most of us when on holiday are more likely to be out drinking and socialising until much later than normal which can be disruptive for full-timers. Properties have paper thin walls so when new holiday makers arrive late at night with wheelie cases being dragged around, up stairs etc then cupboard doors opening and closing and just generally making the most of their holiday, the two don't sit together well.
Another problem is that locals get priced out of the property market which, to me, is inherently unfair.
I don't live on an urbanisation so there may be many other problems I haven't even considered but I'll stick my neck out and say there must be enough of a problem for the communities to consider banning further Tourist Licences being issued. There will still be many places which are purely tourist areas to buy rental properties in the future and no doubt the prices will reflect this.
One of the reasons these measures have been introduced is the large number of holiday let owners who had been renting out under the radar without paying any tax towards the facilities their guests had been using. Licences have been with us since 2015 and the authorities gave @ 3 years notice yet still, as evidenced by the log-jam of new applications since enforcement last year, this was largely ignored. Whereas often it is the few who spoil it for the many, in this it appears to have been the many who have spoiled it for the few who would have paid their dues without these laws. 
Estate Agents are a law unto themselves but are paid by the vendor to sell their property not to give reasons to walk away from it and as Movingon says, it is the responsibility of the purchaser to do their homework.
I believe that the backlash against tourists worldwide is in it's infancy, as one placard recently in Seville or Granada stated, "We are not a postcard", these places are still people's homes.
Spain also wants to control the standard of holiday accommodation. There was a post a few weeks back with someone looking to buy a flat in Benidorm to rent out as holiday accommodation which had a double bed in the kitchen/lounge, bunk beds in an alcove and another bed on the enclosed balcony and they were certainly not going to pay tax on any income they would have received from it. 
Conditions and restrictions will change and I have no doubt the licences will be renewable in the future to ensure that standards are being maintained. For owners who rented out before the rules were enforced, they should already have had their Tourist Licence long before now when the requirements were nowhere near what they are and so far no laws have been applied retrospectively to my knowledge. Prospective owners again need to do their homework before taking out a mortgage reliant on rental income. As with any business due diligence is essential.
If paying a reasonable fee for the licence and 20% extra on the community fees are enough to make a holiday let un-affordable then the margins were too small to begin with.
I think this will be good for the future of the Spanish tourist industry and the full-time residents but like anything like this there will be a settling in period where there will be winners and losers. I also believe that rates being obtained for licensed holiday lets have increased since the laws were introduced (supply and demand) so in light of this I can only hope that it won't work out too badly for you once the dust settles.
All the best Byron.

John56

Posted: Wed Aug 14, 2019 3:44pm

John56

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Posted: Wed Aug 14, 2019 3:44pm

I don't class these as restrictions but as the LAW being implemented because of those who thought they could operate illegally and reap the benefits of renting out properties without paying their dues, i.e. without paying the Tax on their income.

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jimtaylor

Posted: Wed Aug 14, 2019 4:39pm

jimtaylor

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Posted: Wed Aug 14, 2019 4:39pm

Byron wrote on Wed Aug 14, 2019 1:59pm:

We have our tourist licence and access to the police database and log all our guests with the police, so we are fully compliant. I am just irritated by the ability of the community of owners to block an application and to have the ability to increase my community fees by 20%. They are already one...

... of the highest in the region. If I knew then what I know now, I would have given property ownership in Spain a wide berth, but we did it so have to make it work. We love it when we're at our apartment, and stress about it when we're not!

Where do you get the idea that your community fees can be increased? The law isn't retrospective, so it won't affect you.

Pix Elated

Posted: Thu Aug 15, 2019 7:13am

Pix Elated

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Joined: 13 Apr 2018

Posted: Thu Aug 15, 2019 7:13am

Hi Ray thank you for your very informative post, can you confirm who the president reports to those owners who do not have licence, is it the townhall or local police?

jimtaylor

Posted: Thu Aug 15, 2019 9:57am

jimtaylor

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Joined: 2 Feb 2017

Posted: Thu Aug 15, 2019 9:57am

Good point as usual, Pete, and I agree that it's open to different interpretations. I've just checked BoE and there hasn't yet been an amendment to clarify the statement. 

Davebev1

Posted: Thu Aug 15, 2019 10:53am

Davebev1

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Posted: Thu Aug 15, 2019 10:53am

Like other honest owners I welcomed the licensing when it was brought in summer 2015.  We had already licensed our property voluntarily because we saw the law coming, so to speak - it had dropped from licenses required if you owned 5 or more properties to 2 or more properties so we guessed it would eventually be needed for just one property.  But the sheer pigheadedness of other owners really caused the current situation.  If I heard "oh no one bothers about stuff like that" once from other holiday let owners then I heard it a hundred times!  Even holiday let agents were saying it!  For some reason people (and mainly the Brits) seem to consider themselves above the law when in Spain. 

A couple of neighbours complained about holiday makers staying on the community.  I asked why they hadn't contacted us immediately to tell us our guests were causing a problem (all our neighbours have our contact details) and could they remember which week it had been or give me any details of the family.  "Oh it wasn't your ones, they are all fine.  It's ones in other houses."  We are the only licensed, legal property on our community!  We screen our guests (as best we can) and about half every year have been before and have got to know our neighbours.  

We have paid tax on our rental income for many years in Spain, yet there are people living on our community as illegal immigrants and not paying their Spanish tax (they pay non-residents tax even though they had no other home!).  Those people are now whinging about having to become resident - one sold up rather than become a resident!  Other part-timers over-stay their allotted number of days a year and think that is fine also.  So it isn't just holiday let owners who flaunt the law.

My point is, that there are those who will always ignore the law because they think it only applies to everyone else.  Well report them!  The president and admin will have contact details for the owner so if there is a problem with a renter contact the owner immediately so it can be dealt with.  If the let isn't registered then report it to the authorities.  But the reason why some wont report them is they have to give their own details when doing so and they are 'living below the radar'!

If you have bought somewhere that is classified as a tourist area then you probably holidayed in that area yourself first, so why deny others that same right?  It was your choice to buy in a tourist area, no one forced you to do so.  You only have the range of shops and restaurants and the facilities you have because of tourists spending money in the local community; get rid of the tourists and you will see a lot more empty shops and bars and there will be even more empty properties and the place will look more neglected.  

Communities can vote for no more new licenses, they can agree an increase on future community fees too, but why punish those who have done things legally and honestly?  Instead why not report the illegal lets, the tax evaders and the non-residents overstaying/living on the community?  If there is a problem with a particular renter then tell the owner.  We hear more complaints about the occupants of a property that is let long-term than we ever hear about our guests!

I agree that estate agents do need to be more up-front about the requirement for licenses - but then I have been waging a war of words with certain agents for some time about that for over 4 years and reputable ones (yes, there are some!) do now talk about it.  However an estate agent may not know about your plans to rent it out when showing you properties, and as said above in another comment, it is the individuals responsibility to do their homework first.  Estate agents are not allowed to give legal advice, that is the job of your lawyer.  

When we originally purchased a property we asked the lawyer about holiday let restrictions, we told our fiscal rep about renting it out from the start, but we also spoke with the then president of the community where we intended to buy about renting it out to check for objections before buying the house.  Many people on our community have purchase their properties since we have owned ours and they therefore bought into the status quo.  When our neighbour (not the ex-president but the other side) was selling I asked them to ensure they mentioned our property was a holiday let to any perspective buyers, and they did so - our new neighbour bought in the full knowledge of being next to a holiday let.  our house has also used by the relatives of two of our neighbours!  So honesty is the best policy.  Is it too much to expect my neighbours to be honest with me in return, to tell me if there is a problem, not mumble behind my back and plot to wreck my investment - whilst, in some cases, they have lived as a tax evading illegal immigrant for years!

John56

Posted: Thu Aug 15, 2019 11:01am

John56

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Posts: 2995

5634 helpful points

Location: La Zenia

Joined: 7 Jul 2016

Posted: Thu Aug 15, 2019 11:01am

So many points that are true and well presented. Even after being here a number of years I still can't believe the arrogance of many British and Irish illegal immigrants that believe it is okay to fly under the radar and to not pay or contribute to the Spanish economy from their illegal earnings.

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