 The Impact of Regulations on Short-Term Rentals in the Basque CountryL’impact des régulations sur l’activité de location de courte durée au Pays BasqueYanogah Jules Kone ()
Post-Print from HAL Abstract: This paper evaluates the impact of two successive regulations on short-term furnished tourist rentals across the 24 municipalities of the French Basque Country classified as tight housing markets over the 2016–2025 period, using monthly AirDNA data and a Synthetic Difference-in-Differences (Synthetic DiD) approach. The results show that both reforms primarily affect the entry margin into the market, but through different mechanisms and with different levels of intensity. The first one (January 2020), based on mandatory registration and prior authorization for change of use, structures and formalizes the market without effectively reducing its overall scale: the regulation mainly slows down new listings without generating a significant withdrawal of existing properties, consistent with a compliance-driven adjustment or an entry-barrier effect rather than a contraction of supply. The second reform (March 2023), which introduces a compensation requirement applicable even to already active rentals, substantially strengthens entry constraints and leads to a pronounced decline in new listings, while showing no significant effect on withdrawals at the aggregate level. Data from other platforms, particularly Vrbo, show similar patterns, suggesting that the observed effects are not specific to Airbnb. These effects, however, exhibit strong spatial heterogeneity. Major tourist hubs concentrate the most intense adjustments, with a substantial contraction in supply driven both by a slowdown in new listings and an increase in withdrawals, along with an intensified use of remaining properties, suggesting strong selection effects. Small coastal towns display intermediate dynamics, mainly characterized by entry constraints and more limited effects. Inland municipalities, less exposed to tourism pressure, experience only mild adjustments, primarily affecting the entry margin, with no notable changes in other dynamics. In all cases, the contraction in supply does not translate into higher nightly prices, nor into any observable short-term easing of residential property prices, highlighting the complexity of adjustment mechanisms in tight tourist housing markets. These results suggest that the adjustment mechanisms at work are not limited to supply reallocation effects. In this perspective, this paper contributes to the literature by highlighting a complementary mechanism of property retention by owners, driven by regulatory uncertainty and the option value associated with future uses of the property. Keywords: Regulatory measures; Synthetic Difference-in-Differences; Housing market pressure; Short-term rentals (search for similar items in EconPapers) Published in Doctorales ASRDLF 2026, Mar 2026, Corte (Corse), France There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05569832 Access Statistics for this paper More papers in Post-Print from HAL |
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