Banning new tourist flats will not solve Malaga’s housing crisis and could instead scare off investment, hotel bosses have warned.

It comes as the Association of Hotel Entrepreneurs of the Costa del Sol (Aehcos) has hit out at the three-year moratorium approved by Malaga City Council in July.

Its members claim the fundamental problem facing the city is a shortage of homes, particularly affordable and protected housing (VPO).

The controversial measure temporarily blocks new tourist accommodation, as authorities grapple with soaring housing costs for local residents.

But Aehcos president Jose Luque said restricting tourism does not automatically put homes back into the hands of residents.

‘A moratorium doesn’t create housing, and that’s why we have submitted objections to it,’ he said.

‘If we want to solve Malaga’s residential problem, we need more VPO, more affordable housing and greater administrative agility so that projects can be developed.’

Aehcos said it shares concerns about the increasingly difficult housing situation, particularly for young people and workers in Malaga’s enormous service sector.

But it disputes the premise that restricting tourist accommodation is an effective solution.

The association argues there is no guarantee that properties or buildings which might otherwise have been developed for tourism would instead become affordable homes.

It has also questioned why the moratorium applies broadly across the accommodation sector when much of the debate and evidence surrounding housing pressures has focused specifically on privately owned tourist flats (viviendas de uso turistico, or VUTs).

According to figures from Andalucia’s Tourism Registry in April, Malaga had 18,235 hotel beds compared with 64,760 places in tourist homes.

Aehcos argues the two markets have different characteristics and impacts and should not simply be treated as one.

The moratorium nevertheless affects the broader hospedaje category, encompassing hotels, aparthotels, hostels, guesthouses and regulated tourist apartment establishments.

Warning over investment

The association also warned that preventing the creation of new accommodation could discourage investment, damage Malaga’s competitiveness and make it harder to attract tourists outside the traditional peak season.

It comes as Malaga’s tourism industry is continuing to expand.

During the first four months of 2026, hotels in the city accommodated 542,834 travellers, up 0.8% on the same period last year.

Those visitors generated almost 1.132 million overnight stays, an increase of 6.4%.

Aehcos argues the city needs sufficient hotel capacity not only for holidaymakers but also for congresses, trade fairs, major events and sporting competitions, all markets that bring visitors throughout the year.

The group also stressed the economic contribution hotels make beyond their own premises, arguing that visitors spend money in restaurants, shops, transport and numerous other businesses.

Workers can’t afford to live where they work

However, the association acknowledges the severity of Malaga’s housing affordability problem.

It warned that service-sector workers are increasingly struggling to find homes in the same municipalities where they work – an issue compounded by the Costa del Sol’s transport and mobility problems.

Its preferred solution is for administrations to accelerate construction of affordable and VPO housing, both for rent and purchase, while speeding up planning procedures to increase overall residential supply.

Aehcos also wants tourist accommodation to become less concentrated in Malaga city centre.

It argues that encouraging more accommodation in other neighbourhoods could reduce pressure on saturated areas while spreading the economic benefits of tourism more widely.

Aehcos represents 346 associated establishments and 27,000 workers, encompassing more than 94,000 tourist accommodation places across its membership.

Read more Andalucia news at the Spanish Eye.