Short-term rental in Poland – EU regulation approaching

The European Commission plans to regulate the popular form of short-term rental in Europe by means of a regulation. The announcement is already causing controversy. What changes are planned? What will this change for short term rental market in Poland.

Short-term rental in Poland – dynamic growth

The short-term rental sector in Poland has grown rapidly over the past few. After a temporary lull due to the CoVID-19 pandemic, short-term rentals have returned to favour, providing solid competition to the traditional hotel base offering. Although there are no official statistics, data aggregation portals such as AirDNA or Inside Airbnb allow a conservative estimate that short-term rental accommodation units account for around a quarter of all tourist accommodation in the EU. In Poland, there is 1 in every 5 registered tourist accommodation units offered only through Airbn and Vrbo portals^[1] .

Short-term rental & property investments in Poland

The reasons for this popularity of short-term rentals can be attributed primarily to the strong tendency to see the housing market as a source of capital investment (buying property in Poland as investment), which is fostered by the development of hotel and accommodation infrastructure and the prevalence of digital platforms that allow seamless booking of accommodation.

Regulatory chaos and low transparency of short term lease market

While the growth of this sector is beneficial for consumers and landlords, it also brings with it some undesirable effects. In particular, it contributes to an increase in the price of housing purchased precisely for investment rental purposes. The hotel industry also raises objections to the unrestricted growth of the short-term rental sector, which is de facto not subject to any regulation or restrictions, despite the fact that it performs an essentially analogous function to the hotel sector. Furthermore, as most transactions take place via online platforms such as booking or Airbnb, this creates room for the development of a grey tax area. Although some countries are introducing their own regulations to address this phenomenon, their implementation and enforcement is hampered by the cross-border reach of digital platforms.

Proposed short term lease regulation

The package of regulations to be implemented at European Union level would primarily concern e-commerce sector – i.e. providers of online short-term rental platforms and is based on the following assumptions:

• Obligation for landlords of short-term rental facilities to have an individual registration number on the relevant platform – landlords will have to state in the register exactly what facility is being rented and on what terms,
• Obligation for online platforms to collect and process data on the number of short-term rental facilities and the number of users of these facilities – this data will be regularly provided to the local authorities of the places where the facility is located.

The aforementioned regulations aim to introduce transparency in the provision of short-term rental services, to enable local authorities to act effectively in controlling the implementation of tax obligations, as well as to facilitate the implementation of possible regulatory or licensing measures by national authorities in the future. It is also expected that elements of consumer law / consumer protection will be introduced to the regulation.

The project is now to be taken up by the European Parliament.

[1] Adamiak Cz., SHORT-TERM TENANCY IN POLAND W CZASIE PANDEMII COVID-19, Czasopismo Geograficzne, 93(1): 9-32.