It’s time to end the Airbnb effect on Dublin’s housing supply

Comment: Now is the time to recover the Dublin housing stock lost to tourism

A tourist-free Temple Bar, March 15th, 2020. Photograph: Lorraine O’Sullivan/Reuters

A tourist-free Temple Bar, March 15th, 2020. Photograph: Lorraine O’Sullivan/Reuters

 

The programme for government, agreed by Fianna Fáil, Fine Gael and the Green Party, declares that “the State has a fundamental role in enabling the delivery of new homes and ensuring that best use is made of existing stock”.

But it is bizarrely silent on one of the most serious threats to our housing stock: landlords converting properties – houses and apartments – into holiday short lets.

Pre-Covid, there were more than 5,000 “entire homes” in Dublin available to tourists via Airbnb alone, even in the midst of a housing emergency, and new regulations introduced a year ago ostensibly aimed to recover this lost stock of apartments and houses for “the traditional long-term rental market and thereby help ease the accommodation shortage pressures currently being experienced in this area”.

The previous Fine Gael-led government had known since October 2016 that some form of regulation would be needed. That was when An Bord Pleanála delivered a definitive ruling that the conversion of an apartment on Crown Alley in Dublin’s Temple Bar for short-term holiday lettings needed planning permission as it “constitutes a material change” from residential to commercial use.

But there was a lot of shilly-shallying about what to do. The then minister for housing and planning Simon Coveney told the Irish Independent that Airbnb had been a very positive thing for many homeowners and visitors to Ireland. “I wouldn’t like to undermine that, particularly in a country that relies on so many people coming and going for weekend breaks and so on,” he said.

Issues of capacity

Airbnb, which has its European headquarters in Dublin, had already lobbied the Department of Tourism to press its case for “measures . . . to ensure Airbnb’s continued growth in Ireland”, meeting then minister for tourism Shane Ross to impress on him that the short-letting of residential properties “can be used as a solution to issues of capacity and spread of tourism across all parts of Ireland”.

Lobbying of different government departments continued relentlessly. Records show 49 meetings between government departments and Airbnb or their representatives. The Department of Housing and Planning was talking to Airbnb about developing a “memorandum of understanding” on its operations here. This, the department hoped (vainly, as it turned out), would cover “preventing unwelcome and unauthorised commercial rentals being advertised on the website”.

The Oireachtas committee on housing, planning and local government got involved, conducting hearings and issuing a report in October 2017 that went much further. It recommended a licensing system for short-term letting, applying to platforms such as Airbnb, under which “hosts” would have to be registered with local authorities and all relevant information – name, address, letting type and availability – shared with them.

Separately, an inter-departmental working group was established to “examine the adequacy of the current regulatory framework and its applications to online platforms for short-term tourism-related lettings” – via Airbnb and other agencies who deal in short-term holiday lets such as Key Collection, HomeAway or Booking.com – “and make recommendations for necessary regulatory reforms, if any”.

The 15-member group – chaired by the Department of Housing, Planning and Local Government – was widely representative. It included senior personnel from Dublin City Council, An Bord Pleanála, Fáilte Ireland and the Residential Tenancies Board as well as the departments of Finance, Transport and Tourism, Business and Enterprise, and the Attorney General’s office.

Like the Oireachtas committee, the working group made a distinction between “home sharing” – short-letting a room within a home to help meet the costs of mortgage repayments, rents or other household expenses – and the phenomenon of landlords renting out “entire homes” to tourists thereby removing these homes from the long-term rental market. For landlords, short-term tourist lets are considerably more lucrative than long-term rentals.

A tourist-free Temple Bar. Photograph: Dara Mac Dónaill
A tourist-free Temple Bar. Photograph: Dara Mac Dónaill

As well as noting the disruptive effect of the transient nature of holiday lets on local communities, the working group found that “the lack of visibility on unregulated short-term letting is also a concern and constrains the ability to effectively monitor and regulate the activity”.

It recommended a licensing and registration system that would encompass “all online intermediaries of short-term lettings under which . . . a licence would be required to operate as an online intermediary of residential units” in the State and all hosts, whether sharing their homes or letting entire houses or apartments, would also be required to register with a new statutory authority.

Crucially, the working group proposed that (from a given date) the short-letting of “entire homes” would be permitted only if they were registered and also complied with statutory obligations, including planning permission. “Breach of this requirement by a vendor would be an offence and would also be grounds for the revocation of a licence to operate as an online intermediary.”

It also recommended that entire home short lets should be capped, with a maximum number of stays per year, and that responsibility for monitoring and enforcing the caps “should lie in the first instance with licensed online intermediaries”, which would be required to pay an annual licence fee to fund the cost of monitoring and ensure compliance with the regulations.

But the loose regime introduced on July 1st last year incorporates none of the more stringent measures proposed by the working group. On the question of whether online platforms would be required to register with a planning authority, the Department of Housing and Planning’s FAQs sheet simply said “No”; only the hosts engaging in short-term lettings would have to do so.

So would the online platforms be regulated at all? Again, no. “The purpose of these changes . . . is primarily to address the longer term rental issues arising from the use of properties for short-term letting in designated rent pressure zones, which are areas of high housing demand. The broader regulation of online platforms is beyond the scope of the planning code”.

Airbnb and other online platforms engaged in marketing holiday short lets were not made responsible for ensuring their hosts’ compliance. Instead, the local authorities were left to shoulder the burden of proving that any house or apartment in a rent-pressure zone is being operated as a holiday let for more than a total of 90 days a year. And they would have to hire more planning enforcement officers to deal with illegal short lets.

The vast bulk of entire homes on Airbnb and other online platforms are illegal, as they don’t have the required planning permission for a change of use from residential to commercial. Airbnb and its competitors turn a blind eye to the problem because their business model is based on securing houses or apartments for tourists worldwide.

Banners reading “No tourist flats” hang from a balcony to protest against holiday rental apartments for tourists in Barcelona’s neighborhood. Photograph: Pau Barrena/AFP via Getty Images
Banners reading “No tourist flats” hang from a balcony to protest against holiday rental apartments for tourists in Barcelona’s neighborhood. Photograph: Pau Barrena/AFP via Getty Images

The impacts have been devastating, particularly in areas of high demand. In Temple Bar, tourists – until March 2020 – could be seen on a daily basis trolleying their wheelie-bags through the cobbled streets in search of their holiday homes. Temple Bar Residents, an informal campaign group of which this writer is a member, undertook an after-dark photographic survey of residential buildings at Easter.

The results show many units in darkness in the spring evenings, suggesting that up to 40 per cent of apartments in the area may have been operating as short lets. The high level of vacancy suggested by the survey cannot be explained by students moving home during lockdown; very few students can afford to live in Temple Bar.

Devastating impact

It was the Covid-19 pandemic and its devastating impact on international tourism, rather than the useless regulations introduced a year ago by Eoghan Murphy as minister for housing and planning, that put a stop to their gallop. Suddenly, a slew of apartments were being advertised for longer-term letting on Daft.ie – 353 additional properties appeared in the month of March.

Dublin City Council confirmed this week that it had received only 19 applications since June 2019 for change of use from full-time residential to short-term lets. Of these, 12 were refused, three withdrawn, three deemed invalid and one was subject to a further information request. Over the same period, 637 investigations were initiated, 21 enforcement notices issued and there is one case being prosecuted.

Responding to the issues raised in this article, Airbnb offered the following statement: “Hosting is an economic lifeline for many Irish families with nearly half of hosts saying the additional income helps them make ends meet. Hosting also helps spread guests and the economic benefits of tourism to communities across Ireland – boosting the national economy by more than €2 million a day last year alone.

“We take housing concerns seriously, which is why we have always backed clear rules and we will continue to work with the Irish Government, having already collaborated with more than 500 governments and organisations across the world to help hosts share their homes, follow the rules and pay tax.”

Obligation

It should now be a priority for the new Minister for Housing, Planning and Local Government, Darragh O’Brien, to revisit the regulations on short lets and simply impose a legal obligation on all of the platforms involved not to advertise any apartment or house for tourist use that doesn’t have the required planning permission.

So far, the interests of tourism have trumped the still-desperate need for housing in Dublin. There is no better time than now to recover the housing stock that’s been sacrificed to tourists.

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