Government plans to curb short-term letting overly restrictive, says EU after initial review

Government plans to impose rules limiting short-term property letting have hit an early stumbling block with an initial assessment from the European Commission deeming the proposals to be overly restrictive.

The Coalition has also been accused of failing to “provide sufficient information and evidence ... to support the need to adopt restrictive measures”, the aim of which was to take as many as 12,000 properties out of the short-term letting sector and make them available to people seeking long-term rentals.

The commission noted that “in particular, the Irish authorities have failed to provide an assessment of less restrictive alternative measures that could have been considered to achieve the stated cultural policy objective”.

The proposed legislation would see owners offering accommodation for periods of up to and including 21 nights having to be registered with Fáilte Ireland, which would monitor letting platforms to ensure compliance with an obligation for any advertised properties to have a valid registration number.

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Where there is no registration number, Fáilte Ireland would be able to levy a €300 fixed penalty notice on property owners and would have the option of bringing cases to the District Court where the maximum fine is up to €5,000. Online platforms would be liable for fines of up to €5,000 for each property listed without a valid registration number.

The Government had hoped the legislation would be enacted by the end of March but the commission extended a “standstill period” while the law is being considered until December 22nd.

The commission noted that the proposed law “would not be geographically limited to densely populated areas where short-term rentals are more likely to have a significant inflationary effect on the price of long-term renting”.

These concerns were echoed by Fianna Fáil and Fine Gael politicians.

Senator Malcolm Byrne said he had been “flagging the problems with the planned legislation for a while”, suggesting that while “the problem with the planned model is that it could significantly damage certain tourism offerings, especially in rural and coastal communities, while not actually increasing the number of long-term lets available in those areas”.

Fine Gael TD Ciarán Cannon said a more nuanced approach needed to be taken. “The EU Commission obviously shares our concerns about the possible impact on rural communities,” he said.

In response to queries from The Irish Times, a Department of Tourism spokesman said officials were examining issues raised by the commission and hoped to meet its representatives in future.

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He said the department welcomed “engagement with both the commission and the Oireachtas which will ultimately contribute to well-considered legislation in this area”. He pointed out “that similar registers and controls on short-term tourism letting exist in other EU countries and do place conditions on how short-term letting operators and online platforms operate in those territories”.

He said the national Housing for All policy “commits to the development of these controls to require short-term and holiday lets to register with Fáilte Ireland with a view to ensuring that houses are used to best effect in areas of greatest housing need”.

A spokesman for the Department of Housing said updated planning guidelines on short-term lettings “aimed at providing clarity on the planning permission and exemption requirements for properties operating in this area in both rent pressure zones and areas outside rent pressure zones are currently being prepared to supplement the Registration of Short-Term Tourist Letting Bill”.