The Deputy Ministry of Tourism is attempting to restrict the development of short-term rentals in Cyprus. However, the first institutional intervention to limit the number of short-term rentals by any legal or natural person has been rejected by the Legal Service of the Republic.
Specifically, as explained by the Deputy Minister of Tourism, Costas Koumis, the recommendation of the Deputy Ministry for several months was to set a limit of two accommodation units per legal or natural person in the relevant register.
He explained that the proposal was aimed at combating the phenomenon of “parasitic accommodation”, which is characterised by short-term rentals, mainly by foreigners. Under the current legislation, he said, an investor could buy 10-12 apartments in Cyprus, convert them into self-catering accommodation and sell them without any restrictions. He would thus essentially be competing with hoteliers without the same obligations, fiscal or otherwise.
The Legal Service issued an opinion a few days ago that such a restriction cannot be applied. According to Mr Koumis, there will be further discussions with the Legal Service on the matter, as similar restrictions have been applied in other countries.
The European Regulation and Cyprus’ compliance
Currently, the Deputy Ministry of Tourism has submitted a draft law to Parliament for approval, which harmonises at national level the provisions of European Regulation 2024/1028 on the registration of short-term rental properties in a digital register.
Upon completion of this process, hosts will receive a registration number that will allow them to rent out their property. This will facilitate the identification of hosts and the verification of their data by the authorities.
At the same time, online platforms are required to verify the accuracy of property details and carry out spot checks.
This makes it more difficult for illegal accommodation to be listed on the platforms.
In short, the European regulation essentially imposes an obligation on owners of short-term rental accommodation to register in national registers. At the same time, it provides the basis for the registration of information on the property in a uniform manner.
As Mr Koumis said, in the coming period, efforts will be intensified to register short-term rental accommodation in the register of the Ministry of Tourism in order to have a clearer picture of the situation in the country.
According to the data provided, 8248 accommodation establishments are now registered in the Self-Catering Accommodation Register, while another 1275 applications are pending for consideration. This figure is much lower than hotel operators’ estimates that there are 15,000 short-term rental properties in Cyprus.
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