Spain’s Top Court Backs Barcelona’s Plan to Ban Holiday Apartments

A demonstrator holds a house-shaped sign that reads "from touristic flat to temporary rent to Airbnb" during a protest to demand lower housing rental prices and better living conditions, in Barcelona, Spain, November 23, 2024. (Reuters)

One of Spain's top courts on Thursday backed a plan by Barcelona to ban holiday apartment rentals by 2028, rejecting an appeal that argued the measure infringed on the rights of private property owners.

Barcelona was the first Spanish city to adopt a radical decision to shut down all short-term rentals as a way of addressing rising rents.

Following the court ruling, Barcelona's local authorities said they will not renew tourism licenses for short-term rentals after 2028.

"The ruling by the Constitutional Court reinforces, validates and gives legal security to this measure," Barcelona's mayor Jaume Collboni told reporters. "We are on the right path."

Spain is the world's second-most visited country after France, with a record 94 million visitors last year. The country is wrestling with how to balance sustaining tourism, one of the main drivers of its economy, with the needs of locals who say they are being priced out of the housing market by affluent visitors.

In June, Collboni said he would scrap the licenses of more than 10,000 short-term rental apartments, basing his plan on a regional housing decree adopted in 2023 that allows municipalities to decide whether to include holiday flats in their planning permits.

The court said that the regional decree for tourist lets "does not constitute a suppression of property rights".

Airbnb has urged Collboni to reconsider his crackdown on short-term rentals, arguing it only serves to benefit the hotel sector.

The European Holiday Home Association, which represents short-term rentals on online platforms such as Airbnb, also filed a complaint with the European Commission against the region of Catalonia, where Barcelona is located, for allowing cities to ban such rentals.

Other Spanish regions such as the Canary Islands are putting limits on the short-term letting market to contain surging house prices.

Barcelona aims to support the creation of new hotel beds to provide tourist accommodation in areas outside the city center once the ban on renting holiday apartments to tourists comes into force.