05.07.2024
The Cyprus Estate Agents Registration Board has called on the government to ban short-term property rentals – a market dominated by online platform Airbnb – to help bring down rental prices.
The call comes amid growing concerns about the economic impact of an increase in short-term rentals, which is driving up residential property costs and limiting the availability of long-term rental options.
“This phenomenon is gaining alarming proportions and is largely responsible for the rapid rise in rental prices of houses and apartments, keeping their prices at a high level,” said the Cyprus Real Estate Agents Registration Board.
“In a difficult period for Cypriot society, when inflation and high interest rates make owning residential property difficult or even impossible, more and more of our fellow citizens are switching to renting residential property. Moreover, although the demand for rental residential properties is growing, the supply of properties is still insufficient, resulting in rental prices reaching exceptionally high levels, often equivalent to a month’s salary.”
President of the Cyprus Real Estate Agents Registration Board Marinos Kineiro highlighted the seriousness of the problem, saying that “the short-term rental market is depriving the Cypriot residential market of thousands of houses and apartments that could be offered for long-term rental.” He added that the council had previously warned of problems caused by the shortage of affordable residential properties and the negative impact on the quality of tourism in Cyprus, but their concerns had not been addressed.
Kineiro also addressed the twin problems of persistent inflation and high interest rates, which are making it increasingly difficult for Cypriots to purchase residential property, forcing many to rely on rental properties. However, the supply of rental properties does not match the demand, resulting in extremely high rental prices.
“As real estate professionals, we know that many buyers and investors purchase new and second homes as short-term rentals. Consequently, supply will never match demand, resulting in rental prices remaining unaffordable for a large portion of the population,” he added.
Drawing on international examples, Quineiro cited Barcelona’s decision to ban short-term rentals from 2029, offering this decision as a model for Cyprus to consider. He stressed the need for action, saying that “problems are not solved by dreams but by actions and it is time for the authorities to take responsibility as society is suffering. Only by banning short-term rentals will we see an increase in the supply of real estate and a decrease in rental prices in all cities,” added Quineiriou .
The Cyprus Estate Agents Registration Board has also expressed concern about the negative impact of short-term rentals on the tourism image of Cyprus.
“As the council has indicated in the recent past, there are cases where owners of short-term rental apartments do not provide a complete picture of the condition of the buildings in which their properties are located, or even provide misleading photographs to lure potential tenants,” the council said .
To address this issue, the council proposed that short-term rental licenses be issued only to hotels and managed lodging complexes that meet certain criteria.
