Ireland’s STR is Crumbling due to Government Legislation

The Self-Catering sector in Ireland is crumbling due to government legislation.  Due to Government contracts for refugees most economy-priced hotel beds, Guesthouses and many BnBs are not available for the 2023 tourism season.    This has contributed to the prices of hotels going through the roof. The ShortTerm Tourism (STR)  Eco-System is seriously under threat, with downstream businesses such as activity providers, visitor attractions, restaurants, shops, markets, and every rural tourism-related business under threat.

The Irish Government brought in the Rent Pressure Zones Legislation in 2019, the first in 4 electoral districts of Dublin to deal with the housing crisis. Now in just 4 years the RPZ areas now cover 76% of the housing stock in the country in over 50 electoral areas, affecting urban and rural areas.   Guidelines for Planners and Owners of STR were not introduced at the same time as this completely new legislation.  This has led to planners being obliged to refuse planning permission for all STR, no matter how long they are in business.

 

The Self-Catering units on hotel grounds have planning permission as STR, but are now gone to Government contracts. The ISCF considers these to be no longer part of the STR offering as they provide long-term accommodation and providers will need to re-apply to be registered again as STR accommodation.  Details provided by the Department of Integration showed that 13% of all Registered tourism beds stock is contracted to the state, with a large grey market also housing refugees.  Of the STR Beds on contract, 85% are on hotel grounds, with only 15% being in small group accommodation. Fáilte Ireland estimates that of 46,588 beds that are in use in unregistered properties, up to 24,000 are in establishments that could be tourism-related but are not obliged to be registered with the tourism body. This indicates the real need for a register for all short-term rental beds, whatever the source, allowing for a clear view of the economic value of the sector.

 

 First Annual Eurostat Data for  2022

Eurostat has just published its first full-year data for 2022 on the Self-Catering industry. Data from pre-pandemic 2019 as the baseline.  This data is collected from four private collaborative economy platforms as part of the agreement with the EU Commission in March 2020. The largest platforms in the EU market are Booking.com, Expedia (VRBO), Airbnb, and TripAdvisor. Eurostat are providing an overview of the year, as well as quarterly data results on STR bookings with the ‘big 4’ platforms.  The ISCF has stated that in Ireland this data only deals with approx 50% of the bookings, as many are direct with owners or via local marketing agents.

 

 

The Eurostat Results

Ireland has one of the greatest decreases in Self-Catering bookings with Dublin performing worst and down almost 60% since the pandemic.

Southern Ireland ( Wild Atlantic Way South) bookings are down 10%, while the Wild Atlantic Way area is performing better with an up to 10% increase in bookings.

The number of bookings in Prague was down -52% as the Czech government banned Short Term Rentals completely in 2020 and has only started to ease restrictions in 2022.

 

The Future of STR

• The Eurostat Data clearly shows that STR has been growing substantially since Covid. It seems more people prefer to travel in family bubbles to self-catering accommodations rather than to large hotels. In the first quarter of 2023, guest nights at the EU level exceeded the previously highest levels (2020 for January and February; 2022 for March) in all three months via platforms, with the most benefit to France Spain, and Italy* Image

 

• Rural Short-term rental is in much higher demand with a reduction in demand for accommodation in urban areas across the EU. The ISCF has worked in collaboration with Teagasc to bring information to farmers who want to diversify their business and include a tourism offering as part of their family business. A conference was held in Dublin last May for farmers who want to diversify into this area.

 

• There is a serious demand for Self-Catering in rural areas, due to a lack of availability of economy-priced hotel accommodation as a result of Government contracts. In order to increase the supply of self-catering accommodation, clarity is needed urgently from the Department of Housing on Guidelines for Planners and STR Owners. We need clarity for rural /coastal areas separated from urban areas. The size of areas covered by the present RPZ legislation needs to be re-visited to allow rural accommodation to continue, especially on family farms.

 

• There needs to be much more marketing of STR related to outdoor activity, local food experiences, and wellness events. This development needs Government support and backing.

 

• The STR industry is not the cause of the housing crisis in Ireland. It has received little Government support during Covid and with the introduction of an EU-wide Register, development funding is needed to allow the sector in Ireland to catch up with other EU countries. We may have increased connectivity into the Island of Ireland, but without a choice of accommodation at all price points and the size of our business, we cannot flourish.

 

• Sustainability will be at the heart of all future developments in tourism and Self-catering in all its forms from renovated old houses to glamping and Eco-lodges is much more sustainable as an offering than a hotel which uses a lot more energy to maintain then.

For Comments or information on the Irish Self-Catering Federation contact info@iscf.ie