Professor Eduardo Parra leads the 'Sustainable Territories, Socioeconomic Development and Tourism' Chair of the University of La Laguna (ULL), which emerged last October through an agreement between the University and the Canary Association of Vacation Rentals (Ascav).
Parra, who knows Lanzarote well and spends his summers in La Graciosa, has launched an observatory on vacation rentals to measure the economic impacts they generate locally and would like institutions such as the Government of the Canary Islands or the Cabildo of Lanzarote to join in supporting the research.
Ekonomus has spoken with him to learn from an academic point of view what vacation rentals are, who benefits from them, and whether they really have any impact on access to housing for the local population.
- What defines a vacation rental as opposed to, for example, a tourist apartment?
A vacation rental is defined by having an economic activity development, which is primarily used as a property, and which is temporarily given to third parties as tourist accommodation. Normally, the vacation rental also has residential use. A tourist apartment, on the other hand, is born with that tourist use.
"The city councils of Paris and Berlin concluded that between 20 and 30% would be the maximum that could be dedicated to vacation rental use without affecting the local population"
- According to the National Statistics Institute, vacation rentals in the Canary Islands represent 4.1% of the total, but in Yaiza or Haría it exceeds 15%. What percentage could we consider sustainable so that it does not affect the prices of regular rentals?
That has not been studied yet, neither by the Government of the Canary Islands nor by the Cabildo of Lanzarote, who we would like to collaborate with us. At the Chair, we are studying the work that has been done in Berlin and Paris, which concludes that between 20 and 30% would be the maximum that could be dedicated to vacation rental use without affecting the local population.
However, if more homes are taken out of residential use and the housing stock is increased, the use of vacation rentals could also be increased, but always in a proportion that has not yet been studied here.
"A small investor who has a second home and decides to take out extra money for their family to live better or to send their children to study abroad, is going to do it"
- Do you consider that vacation rentals do not have a relevant impact on housing shortages or prices?
Blaming vacation rentals is a mistake. The percentage is very small. Blaming it for the increase in prices is a fallacy. I am concerned when I hear people say that, and recently it has been heard from someone important.
Capillary speaking, vacation rentals allow tourism money to also reach Canarian families. I think of the small investor, who has a small house or a second home, which they can dedicate to vacation rentals to get extra money for their family to live better or to send their children to study abroad, they are going to do it.
"In Lanzarote, I think there are between 3,000 and 4,000 apartments that have gone from extra-hotel to vacation rental"
- Do you have data on how many vacation rentals belong to families and how many are extra-hotel properties of business groups, the so-called pseudo-hotels?
That is another question that is yet to be studied. As an approximation, I can tell you that on your neighboring island, in Fuerteventura, there are between 5,000 and 6,000 homes that have gone from extra-hotel to vacation rental.
An obvious transfer is taking place, they are seeing a much more dynamic possibility in vacation rentals than in extra-hotel. In Lanzarote, I think there are between 3,000 and 4,000 that have gone from extra-hotel to vacation rental.
- Doesn't this phenomenon damage the image of vacation rentals as a way for tourism money to stay on the island?
We have to do a serious and rigorous analysis. It remains to be seen who is behind that business model, whether it is true that there are investment funds behind it. Maybe there are Canarian businessmen and real estate companies behind it.
"To register a vacation rental on Airbnb, they ask for habitability conditions, VV license, building statutes and complete tax information"
- Are platforms like Airbnb not rigorous enough when publishing vacation rental ads?
We buy data from the platforms to do our analysis and so far, all the vacation rentals that appear have a registration code.
What's more, to register a vacation rental on a platform like Airbnb, they ask for habitability conditions, the license (in the case of the Canary Islands, VV), building statutes of the homeowners association and complete tax information.
"Vacation rentals in Lanzarote represent 30% of the tourist places offered on the island and the average rate is around 94 euros"
- What is the weight of vacation rentals in Lanzarote's tourism?
Vacation rentals in Lanzarote represent 30% of the tourist places offered on the island and the average rate is around 94 euros per night. The occupancy in vacation rentals is around 85%.
We could say that the price of vacation rentals is close to that of three or four-star hotels in Lanzarote. There are already families and a target tourist audience that see more possibilities in vacation rentals.
- What are the clients of vacation rentals like?
Approximately 50% are families, 30% travel as couples and the rest are groups of friends. The expenditure is around 1,500 euros per stay.
"In La Gomera, vacation rentals represent more than 50% of the total tourist places. In El Hierro it is around 70% and in La Palma 55%"
- Some political parties have expressed their willingness to make changes to the laws that regulate vacation rentals. Do you think there will be changes?
There could be, but I think that right now vacation rentals are complying with all the security requirements for any tourist and meet all the minimum quality requirements.
Vacation rentals are a legal and quality form of accommodation and anyone who uses it can be sure that those standards are correct. Therefore, from there, everything that can be said, or everything that is wanted to go against vacation rentals, I think is, I insist, a mistake.
- Is it true that in the green islands the majority of tourist places are vacation rentals?
Vacation rentals are part of the structure of the tourism value chain, along with the rest of the accommodation models. We have to see how to integrate all these models within a tourist structure of islands. For example, in the green islands if they remove the vacation rental accommodation model they have a big problem.
In La Gomera, vacation rentals represent more than 50% of the total tourist places. In El Hierro it is around 70% and in La Palma 55%. This is not a question of political parties, it is a question of basic economics and a plate of food for many people.
