Vacation Rental On The Rise

Tourists are renting more and more houses for leisure purposes, competing strongly with the traditional hotel industry.

Tuesday, November 9, 2010


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Vacation rental is defined as the renting of villas, houses, apartments or country estates for a few days or weeks, and is growing fast around the world. Central America is no exception to this phenomenon, which suits especially families or small groups.

In Costa Rica, this activity is generating over $100 million a year in revenue, estimated Galo Malavasi, CEO of Summerland Group, a broker dedicated to vacation rentals.

The traditional hotel industry sees these rentals as unfair competition, as they are not regulated or controlled by tourism authorities, as are hotels.

More on this topic

The (Already Lost?) War Against Vacation Rentals

April 2014

The trend of renting out non-hotel accommodation for a few days is global, and it will grow even more in the next 5 years, so regulating it will be a better solution than banning it.

In Central America Panama is the country where the phenomenon of Holiday Rentals shows the highest growth, despite a law prohibiting it.

Rental Properties in Nicaragua

January 2017

Already more than 1000 homes are available to rent through the web platform Airbnb, and most of them are centered around the Pacific coast.

The increasing supply of houses and apartments available for short stays is forcing hotels to change their methods of attracting guests in order to survive. In the case of Nicaragua, where the hotel supply is relatively nascent and not as developed as in other neighboring markets, the efforts that businesses in the tourism sector have to make to compete with Airbnb is even greater.

Boom in Vacation Rentals Hurts Hotels

April 2013

Hotel owners are complaining of unfair competition from apartment owners who rent their properties for tourism at low prices.

Hoteliers in Panama believe that competition is not fair because these property owners do not pay tourist tax and work illegally.

Although there is a law that prohibits renting apartments to tourists for less than 45 days and which is punishable with a fine $50,000 for repeat offenders, apartment owners who have failed to sell their properties see in the vacation rentals a way to recover their investment.

Costa Rica: Tax on Holiday Rentals

August 2014

A draft anti tax avoidance law to be discussed by the Assembly in Costa Rica clarifies the obligation to pay sales tax on homes rented out for less than a month.

Sales tax on holiday houses rented to tourists is already covered in the General Sales Tax Act, but in practice "... this obligation is often breached by owners," affecting the formal hotel sector, which has to pay the same tax.

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