A significant proportion of private holiday rental accommodations in Malta is operating without the required licenses, according to new data published by the Malta Hotels and Restaurants Association.

The data, presented as part of a carrying capacity study commissioned by the MHRA and conducted by Deloitte, highlights a disparity between licenced and unlicenced private holiday rentals.

As of 2023, the Malta Tourism Authority issued 5,771 permits for these units, referred to as holiday-furnished premises.

However, an analysis of the platforms Airbnb and VRBO found there are some 10,043 properties of this nature listed on the local market. 

The study suggests that nearly half of private rental properties are unlicenced and operate outside the scope of regulatory oversight.

Private rentals take just under a third of guest nights 

The data also suggests that private holiday rentals continue to grow in popularity, with the sector accounting for just under a third of all tourist guest nights in Malta in 2023. 

A slight jump in popularity has also been observed, with the sector climbing from 31.9% to 32.4% between 2019 and 2023. 

However, the study also pointed out that private rentals appear to be heavily impacted by seasonality, with properties surging in the summer months but drastically reduced during the winter period. 

Airbnb data shows that 6,000 entire homes are available for rent in summer, but only around 3,000 are available between January and March.

The report says this allows operators to keep their occupancy levels comparable to collective accommodation - such as hotels - and redeploy the same properties for longer-term rental during the shoulder months. 

“The trends observed suggest that this segment is being used opportunistically by individual property owners to maximise on the tourist segment in the summer peak by acting as a spillover to collective accommodation while exiting the market in the shoulder period,” the report said. 

While the report also highlights a need for tighter regulations around the industry and level the playing field between short lets and traditional hotels, the findings come only days after the MTA announced its plans to introduce new restrictions on Airbnb rentals. 

The proposed rules will require apartment owners who wish to rent out their property as an Airbnb to get the go-ahead of their condominium neighbours first. 

Failure to do so will bar a landlord from being able to licence the property as a short-term rental.