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‘Overtourism’ poses threat to housing and environment in several major world cities, says Canadean

14 December 2016

As global tourism grows at an unprecedented rate, with 2016 experiencing an increase in worldwide outbound trips by over 4.1% annually, the problem of ‘overtourism’ is starting to cause concern for a number of authorities within popular tourist destinations, according to consumer insight firm Canadean.

The company’s latest insight finds that, while tourism has great potential to improve the lives of millions of people through increased employment, it poses serious challenges for countries or cities which do not have the capacity to deal with increased visitors in terms of infrastructure and environmental strategies.

Gillian Kennedy, Ph.D., Analyst at Canadean, explains: “In numerous cities around the world such as Reykjavik, Amsterdam, Venice, Barcelona, and Zanzibar City, the negative consequences of increased tourism numbers have already been felt with government authorities struggling to curtail the problem while retaining their profitability.”

The problem is particularly acute in Iceland, which has witnessed a growth of 163% for inbound tourism between 2010 and 2015. While this has been a positive feature for Iceland’s economy, problems such as overcrowding and pollution of major tourism sites represent serious challenges for the Icelandic government.

Beyond environmental concerns, Iceland is also undergoing a housing crisis driven by the rampant surge in Airbnb properties, particularly in Reykjavik where there are not enough hotels to accommodate the increase in tourism flows. According to one of Iceland’s leading tourism sites, Túristi, Airbnb rentals in Iceland increased by 124% last year alone, which has resulted in a dramatic increase in house prices in central Reykjavík, and a paucity of long-term rentals.

Kennedy continues: “The Icelandic government has recently hinted that the era of free entry into Iceland will soon end with the introduction of entrance fees for tourists, which officials say will be used to invest in infrastructure and hotel capacity. While Iceland is an extreme and cautionary example of the dangers of overtourism, it is a phenomenon that is starting to take hold in other regions too.

“In Barcelona, for example, the local authorities have said they will fine vacation rental websites Airbnb and Homeaway €600,000 (US$633,000) each for offering lodging that does not have the required permits, in a clear move to curb overtourism in the popular Spanish destination. Venice, meanwhile, is suffering from damage due cruise ships entering the area because of the fragile structure of the city, according to UNESCO.”

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Editor’s notes

- Comments provided by Gillian Kennedy, Ph.D., Analyst at Canadean.

- Information based on Canadean’s report: Tourism Demand and Flow in Iceland, 2011 - 2020.

- All information correct at time of publication and based on Canadean's research methodology.

For more information

Please get in contact if you have any questions to this or other Canadean reports. Analysts are available to comment. Contact the Canadean press office on +44 (0) 161 359 5822 or email press@canadean.com

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