Urban regulations for holiday rentals in spain

A few notes on the Supreme Court Ruling (TS) No. 1550/2020, 19th November 2020.

The TS Ruling confirms that Town Halls have the authority to establish regulatory measures with regards to holiday rentals in apartments and private houses, but these should always be based on the general interest, such as the protection of the urban environment or the right of the citizens to an adequate house.

The Ruling opens an interesting debate on the extent of the authority of municipalities to regulate urban planning for holiday rentals in Spain. It explains that any regulation that constrains the exercise of individual rights or establishes significant requirements in order to perform an economic activity must comply with the principles established in the Law 17/2009 and 20/2013.

In accordance with the case law of the EU Court of Justice the protection of the urban environment and the right to housing constitute compelling reasons of general interest that would allow the application of an urban regulation of holiday rentals, but always observing the principles of proportionality and necessity.

The municipal urban regulation of the VUT must meet the following requirements:

– Municipal regulation must focus exclusively on urban planning. Therefore it must be framed in the context of the uses of land and buildings.

– The regulation must be based on reasons of general interest, such as the protection of the urban environment and the right of citizens to decent and adequate housing.

– The measures must be proportionate to achieve the objective pursued, without extra limitations.

Change of use of a house, from residential to holiday rentals may require a license, which can only be granted if the applicable urban planning standards are met. These must be respected by the service providers that carry out the activity.

As these holiday rentals are usually located in buildings of residential use, there is a real need to coordinate the urban planning and tourist regulations, as municipalities do not usually contemplate the coexistence of both in the same plot or building.

In conclusion, Public Administrations must regulate holiday rentals in order to protect the urban environment and the right of the citizens to a proper house,  but always bearing in mind the free market rights and the free provision of services.