Month: March 2024

I have just returned from a last minute holiday to the south of Tenerife. I last visited 16 years ago when I had a business and property over there. Back in 2008 it was very much a middle of the road destination, great weather all year round, good connections from UK airports and reasonably priced accommodation with the usual Spanish hospitality.

2024 is a whole different kettle of fish. It’s busy and I mean really busy. The hotels are huge and a construction boom has joined up all the resorts that now feel very similar. Like Mallorca, it’s tourism on a massive scale and makes Ibiza look like the small island of fishing villages that it once was.

Talking to some Tenerife locals about how the island is progressing I had some interesting feedback.

•Too much emphasis on tourism

•The island is too busy

•the need for stricter rules for tourists

•Rents are soaring so people on average salaries cannot afford to live

There were camper-vans everywhere. Does this sound familiar? It would appear that Tenerife is having the same issues as Ibiza.

Anti tourism graffiti is daubed on walls. Reading through the press the back lash on tourism seems so be relatively small but noisy, similar to the Prou movement in Ibiza that peddle the same narrative. As we have seen in the UK with ‘Just Stop Oil’ it only takes a few hardened radicals to garner the headlines and control the narrative.

Ibiza’s Prou movement has been relatively quiet after their chickens came home to roost during the pandemic when their perceived Ibiza paradise became a reality with no clubs or dancing or busy bars and only natural and culinary pursuits to pique everyone’s interest. This paradise was actually a hell for many who suffered near financial ruin trying to prop up their businesses when travel became a dirty word

Love or hate tourism, the effects of the pandemic showed its necessity to the Spanish islands. Never in the history of Ibiza have the battle lines been so clearly drawn in the sand, without tourism the thriving Ibiza that we know today simply can’t function and zero growth means recession and socio-economic problems.

So I think we can all agree that Ibiza needs tourism to survive, 99% of all island industry relies on it but the pertinent questions are ‘what type of tourism is best and what is the capacity? There’s such a broad spectrum of businesses with different priorities so who gets to decide? The Spanish bar owner or Beach Club operator have different clientele.

Ultimately it’s the market that decides who and how many come to Ibiza. The profile of the tourist will be driven by the offer and if there’s demand then the airlines will increase capacity and hotels will edge up their prices. It’s no coincidence that Ibiza has the highest real estate and the most expensive hotel rooms in Spain.

The local government can control things by applying the law but unfortunately they don’t do that very well. Spanish rental laws favouring tenants make it a risky business for landlords to rent apartments to locals who have the right to stay for up to 5 years (7 years if renting from a company!) and if tenants don’t pay then it requires a costly and protracted court case to evict them.

So some owners continue to offer their apartments for short term rent on Airbnb and other platforms to avoid this risk and fund big mortgages because of Ibizas crazy house prices which are booming because of all the growth that the radicals hate.

Meanwhile Aena, the Spanish airports operator openly boasts of record arrivals without a hint of irony that the islands can’t cope and the effect it has on the local population.

Confused? Well you should be because unless there are some realistic solutions put forward by the authorities too afraid to upset powerful lobby groups then it won’t get better and the radicals that exist in Ibiza and Tenerife and Mallorca and Lanzarote and all those traditional holiday destinations will gather momentum again while choosing to conveniently forget what happened last time there was a catastrophic event to the tourist industry.

Social housing for public sector workers, housing laws that protect both sides with quick resolutions for non-payment, realistic agreements on peak times capacities, inspectors to actually inspect apartments that blatantly rent out accommodation on holiday platforms and disregard the local law. Is it too difficult to put an action plan together?

Or alternatively let’s blame tourism and vilify tourists in general when actually they are our greatest commodity and should be welcomed with open arms. It’s not their fault that the powers that be simply can’t get their act together.

Over our usual Friday drinks a big debate rumbled. A studio apartment in San Antonio bay had just rented for 900 euros PCM on 12 month contract. A couple of our crowd shouted the usual ‘greed’ and ‘scandalous’ adjectives but I completely disagreed, I think it’s a fair price in the current market.

It’s no a secret that there’s a rental crisis on the island due to the most simple of economics: high demand and very low to almost non existent supply.

To cut a long story short, there used to be plenty of apartments to rent but now there’s very few because of varying factors however the overriding reason (in my humble opinion) is that Ibiza is such a great place to live that all those summer apartments have been taken up by the new wave of residents in search of a better life. Why else has the Ibiza population doubled in the last 25 years?

Anyway I digress, back to the accommodation crisis and a reasonable price to pay for a studio in San Antonio bay. I am of the opinion that 900 euros per calendar month is a decent price in 2024. Now before all the ‘Ibiza winter residents’ start screaming at their screens you have to understand that the market decides on the price then the landlord decides if they want to do a deal by lowering it for friends or family or raising the price to maximise their earning potential.

This is where our debate became heated. It’s easy to shout ‘greed’ but since when did maximising on your investments become a crime punishable by ostracisation? The blame can’t be laid at the doormat of the private landlord (although the so-called ‘agents’ have a lot to answer for) they are simply following market forces. Their apartment that rented for 240 euros per month for 6 months in 1994 is now worth 1500 euros per month on a 12 month contract in 2024. You might not like it but that’s how it is.

Regardless of market forces the situation has become very serious for nurses, doctors, police and teachers who are finding it nigh on impossible to source reasonably priced accommodation that is in line with their salary. Given the upward trajectory of White Isle real estate we’ve known for the best part of a decade that this moment has been coming and finding a solution lies squarely with the local and Balearic government who’s job it is to fill these public sector spaces.

Many moons ago when I worked in London I was paid a ‘large town allowance’ to compensate for the high cost of living and I also lived in subsidised accommodation provided by my employer.

This is over 35 years ago and it’s not rocket science to apply the same thinking to Ibiza in 2024. The local governments need to stop shrugging their shoulders and find a solution because it ain’t getting any better anytime soon. Yes there’s lots of building going on in Ibiza at the moment but have you seen the price of new apartments? Eye watering!

Time to think outside of the box. Disused public buildings need to be converted into low cost accommodation and land needs to be procured to build housing specifically for public sector workers. It’s the only way the island will continue to function unless they can magic up 200 cheap apartments from private owners which won’t happen and why should owners lower the prices because the government can’t get organised.

We are almost at the tipping point and big problems need radical solutions. It’s time to stop berating private owners on social media and put pressure on the respective governments who continue to stick their heads in the sand refusing to acknowledge the severity of the problem.

If a realistic solution isn’t found then public services will dwindle away on an island with an ever growing population. That’s the real story here, 900 euros PCM for a studio just emphasises the urgency.

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