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ANY LICENSING SYSTEM for Airbnb properties that could be considered in the future would likely only impact the capital.
Minister for Housing Eoghan Murphy is set to publish a report by a departmental working group, tasked with reviewing if new regulations should be introduced for lettings websites such as Airbnb, in the coming weeks.
It’s understood that regulations that are imposed in other countries are being considered for Ireland if the report deems that prevalence of short-term lets is making the housing and homelessness crisis worse.
A number of major cities have clamped down on the use of AirBnb.
Hosts in Berlin are only permitted to rent out their property for 50% of the year, while Amsterdam imposed a limit of 60 nights a year.
However, sources state that if the government goes down the route of a licensing scheme, it is likely to only impact Dublin and other surrounding areas.
Regulations of short-term lets, such as those offered by Airbnb, would vary from region to region – it will not be a roll out of blanket rules across the country.
Cost of a permit scheme
The issue surrounding the cost of rolling out such a licensing system – which would require cross-body co-operation from local authorities, as well as policing – is under consideration.
The issue of short-term lets taking properties out of the normal rental market has been highlighted for over a year now.
Minister Murphy has said he is “all in favour” of home-sharing, stating previously that it can help many homeowners that are in mortgage arrears, help people make extra money, as well as pay off mortgages.
However, he is concerned if short-term lettings are taking housing and rental stock out of the market and adding pressure on the sector.
If that is the case, and the report determines it is having an adverse impact on the market, a permit system will be looked at.
It is understood that all options are on the table, but that any new system would not be an “archaic” one.
“We are looking at international best practice, what other cities have done, where we have high demand areas, but also areas which are tourist destinations, to make sure we are not losing a significant amount of supply of housing out of the normal market for short-term lettings,” said Murphy about the group.
When we talk about home sharing – I am all in favour of it – but it has to mean home-sharing and that is what we are trying to achieve.
Commercial use
Last year, Minister Murphy issued a circular notice to all local authorities stating that apartments will require commercial planning permission to be used as short-term lets, which is restricted for up to 60 nights a year.
The letter also stated that owners should not be allowed to rent their properties for more than five nights in a row.
The document, which was published on the department’s website, highlights the current planning laws, which states that the change of use of a property, such as for short-term lets through platforms like Airbnb, requires planning permission.
A maximum of two rooms per apartment can be occupied per night with no more than four guests.
No more than 20% of the apartments accessible on any floor from any access stairwell or lift core can be approved for short-term letting.
In a statement, Airbnb said the criteria makes Ireland “one of the most excessively restrictive regimes in Europe”.
This guidance is a step in the wrong direction towards one of the most restrictive regimes in Europe on how regular people can use their homes. It is complex and confusing, and will increase costs, red tape and bureaucracy for everyone.
We want to work with the government to clearly distinguish between regular people sharing their homes and professional operators running a business, and make it easier – not harder – for families to follow the rules and share their homes.
Last weekend, The Sunday Business Post reported that the US multinational warned members of the Oireachtas Housing Committee that the economic impact of onerous regulation could be as much as €506 million per year.
Cost to the economy
The letter seen by TheJournal.ie states that Irish hosts have welcomed close to 1.2 million guests in one year on Airbnb resulting in €115 million earned by local households.
The company highlights their Dublin analysis of potential Airbnb income, which the company said shows that you need to host or rent your apartment for around 160-180 days in a year for it to be more lucrative to put your property as a short-term rental than long-term rental.
In 2016, out of a total of 3,828 entire home listings shared on Airbnb, only 550 rented for more than 160 days, states the letter.
It adds:
“Therefore, the possible ‘commercial operator’ owned listings amount to 550 of which many of these will also be traditional and permitted B&B’s and serviced apartments.
“If overly heavy regulation is pursued to tackle the 550, that prevents the remaining 3278 to offer great, local accommodation that the tourism industry needs, there will be a huge loss in terms of economic impact to the Irish economy (e.g. €506 million in 2017).”
Once the minister publishes the report, it is unclear as to what department will drive any new policies. Both the Housing and Tourism departments have a stake in the matter. It’s understood this will be nailed down once the report has been released.
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@Willy Malone: What I just cannot believe is how myopic the vision behind this kind of typical, over-complicated and counter-intuitive (but typical) set of guidelines actually is. If you can put aside the morality of what is ostensibly massive overreach by the state, removing the rights of an individual to own private property, what about the bloody tourism industry. As usual, another politician/pretender playing for the golden-spoon-come-wannabe-working-class-hero populist image, by killing the goose that lays the golden eggs for his personal ambition. Once tax receipts have dropped another billion euros per year, just muse on where the state is going to get the new money needed to cover the welfare and housing requirements of all the newly unemployed tens of thousands of service industry workers created by the massive knock on effect caused by reducing Dublin’s tourism capacity by more than a million visitors every year. The tourism minister must be feeling Machiavelli’s knife right at his throat. Unbelievable, short-term and typical.
@ElectroneumNews❤️BTC: There are currently at least 275 2 bed+ houses being advertised to rent in Wicklow County.
There are currently more than 270 2 bed+ houses being advertised on AirB&B in County Wicklow.
And some people think AirB&B isnt contributing to the problem? What supply there is in the private rental market is being reduced both by AirB&B rentals and as Landlords are both selling up as they see the prices of houses rise.
@ElectroneumNews❤️BTC:
There are currently 275 or more 2 bed+houses on Air B&B in County Wicklow in County Wicklow. At the same time, there are only 20 2 bed+ houses for rent on real estate sitesfor County Wicklow.
AirB&B is part of the problem, especially as people are forced out of Dublin by unavailibility of rents and housing pressures, and landlords in wicklow are selling up to take advantage of rising house prices.
Let the councils and governments sort out THEIR failure. Airbnb have nothing to do with it. Used as a scapegoat by the incompetents that inhabit every level of government here! Dublin flat as a pancake. As if there aren’t simple solutions to solve the crisis …
@Shane Zerbe: It certainly is a factor in the current shortage problem. To say it has nothing to do with the current problem is foolish.
@Reg: I don’t think it’s any of their business frankly. The councils height restrictions limit hotel rooms being built for example, which would compete with the Airbnb rentals …
@Shane Zerbe: @Shane Zerbe: There’s not problem with AirBnB so long as users register for income tax with Revenue.
AirBnB is Schedule D Case I income. You must register.
Revenue are going to take thousands of people to the cleaners over the next few years with fines and penalities for failure to register for Income Tax and completing an annual Form11.
@Good Early: you don’t need to register. You just need to pay your tax returns or face the consequences. The revenue are a very effective organisation. People will pay, either on time or not.
@KingBen: you’re wrong. I’m an accountant and participate in audits all the time.
If you are operating a trade, it your legal responsibility to register for Income Tax with Revenue.
If.you run a B&B, and that includes Air BnB it is classed as.Shed D Case I Trade Income, and you are therefore required to register with revenue.
Most people put the income under the Rent-a-Room relief when declaring to Revenue (which is tax free) but when/if Revenue discover the actual source of the income, AirBnB, people, are being hit with charges and penalties along with the income tax owed on the income.
@Good Early: doing your tax returns, registering… Same thing.
@KingBen: it’s not the same thing. Commonly, PAYE workers are filing a Form12/eForm12 via MyAccount. They are claiming the AirBnB as tax free under the Rent-a-Room relief scheme. Which is wrong and making an unlawful declaration of.income. One woman told me that’s how her last accountant told.her to do it until she got.auditted by Revenue.
The Irish Tax Consolidation Acts state the responsibility falls on the taxpayer, not Revenue.
To register for Income Tax you have to sign-up to ROS and register in there. Its not automatic with Revenue.
We’ll all be doing eForm12 tax returns in the next few years the way things are going. But if you have trade income (AirBnB) it’s up to you to sign up to ROS and register. Its.your responsibility, not Revenue’s.
@Reg: it’s nobody’s business what I do with my property’s if I want to Airbnb my city apartment that’s my choice and for the government to use that as an excuse for there incompetence is foolish.
It’s their property, but hey, we failed in our role so let’s punish the average citizen
Build homes…
@Willy Malone: The problem is homes being built in the city centre are being turned into de facto hotels. This will hopefully ensure that the homes will be used for the purpose they were built for.
‘However, he is concerned if short-term lettings are taking housing and rental stock out of the market and adding pressure on the sector.’
So the wonder boy Murphy is still scratching his head wondering why landlords are exiting the rental market and opting for AirBnB? How about the following reasons: 1. 52% tax 2. Rent Controls 3. Regulation designed to favour tenants and punish landlords. No one, not even Murphy, needs a report to tell him this – just ask anyone.
@Brian Deane: most sensible comment on this subject bar none.
@Brian Deane: But you still have to pay all those taxes for AirBnB as BnBs are classed as trades and are liable for the relevant taxes under Schedule D Case I.
If you’re putting it under Rent-a-Room relief you’re breaking the law as only people with a fulltime permanent lodger can avail of that. On a review Revenue will request you supply all their info and will tax you as you were operating a trade business, and will charge you back taxes and penalties.
The ignorance around these schemes.from.educated people.is nothing short of astounding!
If anyone doesn’t believee.call.Revenue and ask.
Hopefull that goes trough. People live in tents, rents are ridiculous, any step that can help to ease that crisis should be taken now.
@Hubert Sz: but an taisce a few cranks and the Georgian buildings would be upset …
@Hubert Sz: I do airbnb. I pay full tax, the taxman loves me for the amount of tax I pay. If airbnb stops tomorrow my property won’t help any people in need in tents nor will it bring the rental market prices down. Not sure you comments make any sense at all.
What are we going to do tomorrow Pinky?
Same thing we do every day Brain. Try to solve the housing crisis.
Regulation for Dublin, rest of country do what youz like, nod nod, cash cash, wink wink!
Meanwhile… some ministers keep on celebrating inaugurations of hotels from what were industrial buildings (instead of providing ‘residential-only’ licenses for redevelopment of those buildings).
Just google it:https://www.google.ie/search?biw=1920&bih=974&ei=51bTWvLwLMfgkgWVr46IBw&q=%28minister+OR+Taoiseach%29+%22hotel%22+AND+%28opening+OR+inauguration+OR+redevelopment%29+site%3A.ie
This is the situation in Ireland: Taking Airbnb as a scapegoat while celebrating the hotel investor lobby (which donates money for campaigns).
A while ago Fine Gael stopped accepting corporate donations. After some time they scrapped this policy. Now they are nothing more than hired guns!
Pretty damning article about the civil service.
They aren’t target based. It’s perpetual bureaucracy, red tape and paperwork. Create nothing, risk nothing. Secure for life and then fat pension.
Stop pretending to have reasons for self perpetuation. Build a bloody house or start a business or make something. Or maybe just let the rest of us get on with doing that and you slope off somewhere.
The problem is it is easier both administratively and tax wise to set up a short term let on Air BnB than it is to plan a long term rental. The amount of hoops you have to jump through to get a house on the market legally is insane. RTB registration, Fire Inspection, BER Cert, Council Inspections etc. and then the govt takes 55% of the rental income in tax, whereas Air BnB’s get €14k tax free!!
If the govt simply rewarded landlords who charged lower rents with lower rates of tax (like with income tax) they would get a huge amount of properties back on the market.
@ForeverFeel1ng: *Jesus wept*
It’s not €14,000 tax free. Whoever your tax advisor is is a complete ass who’s gonna get.you stung with revenue. Rent-a-Room relief is only if you have, and can prove, a full.time permanent lodger.
AirBnB is Schedule D Case 1 Income. The same as if.you are running a business..If you ever get audited by Revenue you will be taxed on all of that income that was illegally declared under the Rent-a-Room scheme, and you will have to pay all the back taxes: income tax, USC PRSI, late filing fees at 10%, plus fines.
Using the Rent-a-Room scheme to.hide.your AirBnB income is illegal and you will.get.caught. Right now I.have have 7 PAYE workers who were selected for a.compliance check and have to file.a.form 12 and Revenue copied on to their untaxed AirBnB income stream. I have had to register them all for income tax and complete form11s for the relevant years. They were none too happy about it. But the alternative was Revenue take them.to court.
@ForeverFeel1ng: You don’t get €14k tax free on Air BnB it doesn’t qualify as it is considered short term rental, not rent a room scheme. You have more chance of renting a house (and keeping one room free) to benefit from the €14k tax free. If it was made official that you would have a decent tax free allowence rental on long term rents it would encourage people to do that instead of air BnB but from what I see the majority (not all) air BnB residences would never be let full time anyway. They are homes and holiday homes. And for the ones that are full time if there was a tax incentive to go the other way it would work, there is alot of effort in the likes of air BnB and short term rentals and the tax levels take the shine off it.
@Bilbo Baggins: 100% correct!
Why did the culchies get away with it again
I really like Mr Eohgan Murphy’s living room as shown in that there photo – white on white on white has moved from cliché to classic! I’m not sure about his decorative decision to hang his bicycle over the white sofa on a white wall. How often does he really ride that old bike of his? I’m worried that he is a bit of a hipster, more concerned with appearance and ahead-of-the-curve cool – hence the placement of said bicycle…does he drink flat-white?
There are currently at least 275 2 bed+ houses being advertised to rent in Wicklow County.
There are currently more than 270 2 bed+ houses being advertised on AirB&B in County Wicklow.
And some people think AirB&B isnt contributing to the problem? What supply there is in the private rental market is being reduced both by AirB&B rentals and as Landlords are both selling up as they see the prices of houses rise.
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