TÜROB President Eresin: "Short-term rental homes are not the sole reason for the decline in hotel occupancy"...

The sharp increase in unregistered hotel-like activities carried out through daily rental homes is among the developments that have seriously and negatively affected our hotel occupancy figures this year. The problem of unregistered daily rental homes had also surged for a period in the past, but it was brought under control through measures taken in every respect; however, over the last one to two years we have observed a serious resurgence in their numbers. It is reported that there are close to 60,000 homes rented out in this way. We regard increasing inspections and taking the necessary action as a very important step in terms of preventing unfair gains, and, even more importantly, for reasons of both security and hygiene.

NOT THE SOLE CAUSE

On the other hand, we must emphatically underline that it would be a mistaken assessment to view daily rental homes as the sole cause of the bleeding in hotels. We had foreseen that the general elections would affect our sector negatively and could in particular lead to deferrals in demand. As a reflection of this, our expectation was that demand would increase in the second half of the year and that the sector would see graphs of rising accommodation figures. Unfortunately, however, as a result of the negative impact of the general election process and the devastating earthquakes experienced in 11 of our cities, these deferrals in demand suddenly turned into confirmed cancellations, and as long as the earthquake remained on our agenda, the world media continued to exploit it. As a result, in addition to the cancellations that came after the earthquakes during that period, we were also unable to attract new demand.
Especially in our city hotels, tourist arrival numbers in the second half of the year began to come in line with our targets; unfortunately, however, lengths of stay shortened considerably compared with previous years. A portion of tourists also came to prefer unregistered homes, whose sale prices are far more affordable. In light of all this, we can say that while tourist numbers are following their normal course, our hotel occupancy figures have fallen short of our expectations. This naturally dampens the sector's morale.

AN IMPORTANT STEP FOR EQUALITY OF COMPETITION

Returning to the issue of daily rental homes: we are pleased that the Ministry of Culture and Tourism has launched legislative work on bringing places rented out daily on an unregistered basis into legal status. Applying taxation and certification to such rentals will both bring the system under control and prevent unfair competition. It will be a very important step in terms of ensuring equality of competition.

COMMERCIAL INCOME SHOULD BE TAXED

While these daily/short-term accommodation provision/rental activities create a high amount of tax loss each year, they also give rise to the opportunity for high tax-free earnings and a large rent-seeking environment. A hotel investor must obtain numerous licenses and permits both during construction and during operation. Yet, unfortunately, the number of those seeking to take a share of this growing market under unfair and unequal conditions has also increased rapidly. Especially in tourism regions, real estate rented or purchased as commercial premises or apartments is marketed like a hotel room. The allocation of a venue for accommodation to the same person for up to 6 months (whether 1 hour, 3 days, or 3 months) is not a lease. This activity, which is continuous in nature, is a commercial activity. The conditions to which commercial income is subject should be taxed.

A LEGAL FRAMEWORK IS ESSENTIAL

We can include the Airbnb system within this scope as well. We particularly wish to state that we are not against Airbnb. As the accommodation sector, we are in favor of diversity.
The most important simple example: on the matter of taxis, we believe that Uber should also operate in Türkiye, and we underline at every opportunity that this is necessary in order to compete with our rivals. All tourism-related systems that exist in the world should also exist in Türkiye. However, we believe the legal framework must be established first and foremost. To return to the subject of Airbnb, the system works this way around the world too. Those who rent out their homes through Airbnb are at the same time taxpayers. But at present we unfortunately have no such practice. This very clearly amounts to unfair competition.

THEY CREATE SECURITY PROBLEMS

Daily rental homes also harbor serious question marks when it comes to security. In the past, unfortunately, very bad incidents occurred in such homes. Whereas in hotels, the moment all guests staying there enter the hotel their records are absolutely taken, and these records go directly to the Ministry of the Interior. But in an Airbnb or a rental home there is no such record. While not in all Airbnb homes, in the vast majority of them there is no identity notification. In addition, in terms of the neighborly rights of other owners living in the same building, they create a constant source of unease and can give rise to complaints.

COSTS ARE PUSHING UP ROOM PRICES

Another negative effect is the rise in costs. The fact that the increase in revenues is not at the same level as the increase in costs is putting the sector under great strain. The rise in energy costs, rising personnel expenses, and cost increases in the supply of materials, particularly food, are also pushing up room prices. As a reflection of rising costs all over the world, room prices continue to climb.

THE TARGETS HAVE NOT CHANGED

As TÜROB and the sector's organizations, we continue with many promotional and marketing activities in public-private sector cooperation. The results-oriented promotion and marketing efforts carried out by our Ministry of Culture and Tourism and the Turkey Tourism Promotion and Development Agency (TGA) are also ongoing. We want to believe that all of this will produce positive results. We have not changed our 2023 target for visitor numbers and tourism revenue. In line with our Ministry of Culture and Tourism, as a sector we are making great efforts to reach 60 million visitors and 56 billion dollars in tourism revenue, and we believe that the tourism sector will continue to provide strong support to the country's economy, employment, and development by reaching its targets.