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Local authorities in France get power to crack down on Airbnb rentals

Authorities in Paris and other French towns will be able to regulate local businesses who wish to rent property on Airbnb, according to a decree published by the French government. 

Local authorities in France get power to crack down on Airbnb rentals
This illustration picture taken on July 24, 2019 in Paris shows the logo of the US online booking homes application Airbnb on the screen of a tablet. (Photo by Martin BUREAU / AFP)

The news was welcomed by authorities in Paris, who have long battled to keep a check on Airbnb and its impact on the rental market. 

On Sunday, the French government published a decree that allows the City of Paris to subject the renting of local businesses to prior authorisation. 

This decree applies to all types of offices, stores or medical offices who may be turned in holiday rentals. 

It aims to allow towns to limit the growth of rentals on Airbnb, “protect the urban environment and preserve the balance between employment, housing, businesses and services on their territory,” says the decree. 

The news was welcomed by authorities in Paris, which has been witnessing “the multiplication of ground floor business premises being transformed into holiday rentals,” said deputy mayor Ian Brossat, who is in charge of housing, in a press release

This decree which comes into effect on July 1st, “will prevent local businesses from being turned into holiday rentals,” Brossat added on Twitter.

The conditions businesses will have to meet in order to get an authorisation still have to be defined said Brossat, according to Le Figaro. But Paris aims to draft these regulations and get them voted by the end of 2021, so they can come into force at the beginning of 2022. 

Other towns allowed to apply the decree are those who have put into effect “the procedure of a registration number for furnished holiday apartments, owners and, subject to contractual stipulations, tenants of local businesses who wish to rent them as furnished holiday apartments.” 

In recent years, Paris city authorities have made tax registration obligatory for apartment owners and have restricted those renting out their primary residence to a maximum of 120 days a year.

Now if owners want to rent a furnished property for less than a year to holidaymakers, they must apply to local authorities for permission to change the registered use of the space.

They are then required to buy a commercial property of an equivalent or bigger size and convert it into housing as compensation. 

Until then, these onerous and time-consuming tasks did not apply to local businesses who only had to fill out a declaration.  

In February, France’s highest court, the Court of Cassation, ruled that regulations introduced to counter the effects of Airbnb and other short-term rental sites on the local property market were “proportionate” and in line with European law.

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TOURISM

Paris wins court challenge over restrictions on Airbnb rentals

City authorities in Paris won a final court challenge on Thursday over rules that restrict the use of properties for short-term holiday rentals in a victory likely to encourage other European cities.

Paris wins court challenge over restrictions on Airbnb rentals
Photo: AFP

France's highest court, the Court of Cassation, ruled that regulations introduced to counter the effects of Airbnb and other short-term rental sites on the local property market were “proportionate” and in line with European law.

“Total victory for the City of Paris against Airbnb and fraudsters who rent their properties illegally,” deputy mayor Ian Brossat, who is in charge of housing, wrote on Twitter, saying it ended five years of court battles.

 

Europe's top court, the European Court of Justice, had also ruled in favour of Paris last September, but it requested French courts to assess some of the specifics of the regulations.

Aiming at tackling housing shortages, Paris city authorities have made tax registration obligatory for apartment owners and have restricted those renting out their primary residence to a maximum of 120 days a year.

Rules for owners of second homes are far more restrictive.

In order to rent a furnished property for less than a year to holidaymakers, owners must apply to local authorities for permission to change the registered use of the space.

They are then required to buy a commercial property of an equivalent or bigger size and convert it into housing as compensation, an onerous and time-consuming task.

All of the these elements, including the compensation mechanism, were ruled legal on Thursday.

The decision means the city will be able to resume its legal claims against 420 renters who have been fined on average €50,000 each for breaking the rules.

Paris was at the forefront of efforts by many European cities to limit the effect of Airbnb on the rental market.

Before the coronavirus pandemic, many property owners in sought-after areas opted to rent their space on a short-term basis to tourists rather than to locals, while the high profits were seen as driving up property prices.

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