Cyprus tourist association seeks stronger regulation of short-term holiday rentals

Stek wants tougher enforcement against illegal holiday rentalsThe association of Cyprus tourist enterprises (Stek) on Wednesday said a recent Audit Office report has confirmed its long-standing concerns over short-term holiday rentals, renewing calls for a comprehensive overhaul of the legislation governing the sector. The association said the Audit Office’s findings demonstrate that weaknesses in the supervision and enforcement of online short-term rental platforms pose significant risks to both visitors and Cyprus’ tourism industry. “The weaknesses in the supervision and control mechanisms for electronic short-term rental platforms constitute a significant risk to the safety of users and may have a direct negative impact on the credibility and quality of Cyprus’ tourism product,” the association stated. Stek said it has been warning for years that the existing legal framework suffers from serious shortcomings, both in its provisions and, more importantly, in its implementation and enforcement. The association argued that accommodation providers continue to operate and advertise without the required licences, while effective inspections remain limited and cooperation between the competent authorities is insufficient. It pointed out that these shortcomings demonstrate that the current system is incapable of fulfilling its intended purpose. According to Stek, simply maintaining a register of accommodation properties is no longer sufficient. The association said that Cyprus instead requires a comprehensive framework of supervision, inspections and effective enforcement to ensure that everyone operating in the hospitality sector is subject to the same rules, obligations and safety standards. Stek argued that inadequate regulation does not only create conditions of unfair competition at the expense of the licensed hotel industry. What is more, it stated that the rapid expansion of short-term rentals also places pressure on the housing market, makes affordable housing more difficult to secure for permanent residents, creates problems for local communities, affects neighbourhood quality of life and may expose visitors to safety risks. In this context, the association welcomed the Deputy Ministry of Tourism’s intention to revise the legislative framework governing short-term rentals, describing the initiative as an important opportunity to address long-standing weaknesses and introduce additional measures already adopted in many European countries. Stek said the revised legislation should include systematic inspections to identify and eliminate illegal accommodation providers, stronger enforcement mechanisms backed by deterrent administrative and financial penalties, and mandatory display of registration numbers on all online booking platforms. It also called for greater cooperation between booking platforms and the authorities to ensure illegal listings are removed promptly. The association further proposed introducing a maximum annual rental period for short-term lets, following the model already adopted in a number of European countries. It said local authorities should also be empowered to restrict or prohibit short-term rentals in specific areas where housing shortages, excessive disturbance or deterioration in residents’ quality of life become evident. Stek also advocated the introduction of a mandatory overnight stay levy together with common standards covering safety, health and insurance for all accommodation providers. The association said the experience of many European countries shows that the sustainable operation of short-term rentals depends on clear rules, effective supervision and a balanced approach that supports tourism while protecting local communities and housing markets. It added that it will participate actively in the public consultation on the new legislation by submitting detailed proposals aimed at creating “a modern and enforceable framework that guarantees fair competition, protects visitors, safeguards local communities and strengthens the long-term sustainability of Cyprus’ tourism sector”. The renewed intervention comes as European governments continue tightening controls on short-term rentals amid growing concerns that they are reducing the supply of long-term housing and driving up accommodation costs in major tourist destinations. Several cities, including Paris, have introduced stricter limits on short-term rentals, including caps on the number of days primary residences may be rented each year, while property owners who breach the rules face substantial financial penalties. At EU level, new legislation that came into force in May 2026 requires hosts to register properties through a common database, making it easier for authorities to identify and remove illegal listings. The debate also comes as online booking platforms continue to play an increasingly important role in Cyprus’ tourism market. According to recent Eurostat data, Cyprus recorded 1,711,525 guest nights in short-term rental accommodation booked through online platforms during the fourth quarter of 2025, reflecting the growing popularity of platform-based accommodation. The figures cover bookings made through major platforms including Airbnb, Booking and Expedia. Across the European Union, guests spent 144.3 million nights in short-term rental accommodation booked through online platforms during the first quarter of 2026. This represents an increase of 9.7 per cent compared with the same period a year earlier and is 16.6 per cent higher than the first quarter of 2024, highlighting the continued expansion of the sector.