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What is family accommodation?
According to the Hospitality Act, this is a hospitality service in a household and on a family farm. According to the tax law, it is the rental and organization of accommodation for tourists.
In essence, these are hospitality services organized and run by a family. This service starts with a single room and ends with a small family hotel. It is a highly valued artisanal, personalized approach to service (craft, artigianale,) in developed countries. Many tourism giants began their historical development precisely as family accommodation. Among them, perhaps the most famous are Hilton and Mariott.
Croatian family accommodation has a long tradition. For example, the newspaper "Jadranska straža" from 1937 writes about "seasonal renting of rooms and providing food in tourist resorts."
The "Works Act" from that era states: "Domestic work that an individual performs independently according to local customs, in addition to his own household, without the right to receive orders, alone or with the help of family members in the premises of his apartment - does not fall under the "Works Act".
The same Act also states: "When an apartment is rented out or food is provided within the scope of domestic work mentioned in Article 1, paragraph 2, item 17, such work shall not be considered a catering business." This legislation confirms the continuity of providing catering services in households from an earlier period, dating back to the time of the Austro-Hungarian Empire.
The importance of family accommodation is most clearly recognized in times of crisis. In 2021, the pandemic year, Croatia recorded 13,8 million arrivals and 84,1 million overnight stays. Compared to the record-breaking, pre-pandemic year of 2019, 2021 saw 67 percent of arrivals and 77 percent of overnight stays from 2019.
By type of accommodation, the highest number of overnight stays was recorded in household facilities (32,1 million). Campsites and hotels recorded almost half as many (17,4 million) and (15,7 million) overnight stays as households.
The war in Ukraine and the solidarity of family accommodation
80% of all Ukrainian emigrants to Croatia are accommodated in private accommodation. Airbnb and Airbnb.org have announced that they will Airbnb.org offer for free, short-term housing for up to 100.000 refugees fleeing Ukraine. These stays will be funded by Airbnb, Inc., donors to the Airbnb.org Refugee Fund, and the generosity of hosts through Airbnb.org.
This emotional connection between guests and hosts has also occurred in times of major crises. The emotional connection between hosts and guests has also been evident in earlier times of crisis. During the Homeland War, hosts were helped by guests, who sent humanitarian aid, welcomed hosts into their homes, lobbied for international recognition of Croatia and an end to the war... Hosts from other parts of Croatia were the first to accept into their homes people from the earthquake-affected areas of Sisak-Moslavina and Zagreb counties, and the City of Zagreb.
Loyal guests are especially attached to their hosts, to the vacation spot as a "second home". They, along with the owners of "cottages", are the backbone of tourist traffic in Croatia. Thanks to this category of tourists, traffic in catering establishments and shops in the tourist area is maintained even in the most difficult times.
What is the economic impact of family accommodation?
We know that overnight expenses amount to 25 to 30% of the total spending on a tourist trip. It means that 70 to 75% of consumption falls on all other services: Transport, trade, food, entertainment and recreational facilities, etc. If the average is 100, 30 remains with the host and 70 is distributed to all other providers of goods and services.
The latest known data from 2018 was published in 2019. According to them, the average household had 6 beds. Each household generated an average of 45.000,00 kuna in income. There were 100.000 registered households that generated 4,5 billion kuna in income. This is only 30% of total travel spending. Total spending reached almost 16 billion kuna. Thanks to family accommodation, everyone else generated 11,5 billion kuna in income.
Every household contributes to job creation
In one household, one double room with breakfast employs half the working time of one person (creating a "half job").
• For every 5 rooms, one cleaning, laundry, ironing job is created.
• For every 20 rooms, the employment of one housekeeper, one internet administrator,
• For every 40 rooms, one driver - attendant, shopkeeper - salesperson, guide, cook, waiter, etc. is employed.
• For every 40 rooms, tourism creates 16 jobs,
• 2.000 rooms create 800 jobs
• If there were no homestay accommodation and overnight stays, there would be no jobs created.
The power of micro-entrepreneurship
Back in 2005, the European Commission published a definition of micro, small and medium-sized enterprises in its recommendation, and in 2016, it particularly emphasized the importance of micro, small and medium-sized enterprises:
• "MSPThey represent 99% of their business in the EU.
• They are the pillar of its economy. They create two out of every three jobs.
• In 2013, more than 21 million MSP-ova has provided almost 90 million jobs in the EU.
"They stimulate a sense of entrepreneurship and innovation, helping to boost European competitiveness, economic growth and employment."
Definition of micro-entrepreneurship
– Has 0 to 10 employees
– Has assets and/or financial turnover of up to 2 million euros per year
– Operates in accordance with applicable law
– Pays taxes
Family accommodation in all categories falls under micro-entrepreneurship. Micro-entrepreneurship through the provision of catering services in households and on family farms should be appreciated and encouraged because business with private real estate can be carried out in a different way, less favorably than the tourist board system.
The owner of an apartment or house can rent it out with a simple Apartment Rental Agreement:
• The apartment can also be rented to a foreigner.
• Foreigner from EU and other countries EEP, as well as a Croatian citizen, can stay outside their place of residence without the obligation to register their place of residence for 90 days in 180 days
• This is the principle by which apartments for tourists in large cities in Spain, France, Germany and other EU countries work...
When renting an apartment, there is no categorization of the facility for providing hospitality services, so there is no flat tourist tax or membership fee. That is why disputes are occurring in many large European cities seeking to regulate tourist traffic in real estate owned by private individuals.
• The advantages of this kind of "non-entrepreneurial" rental of real estate are not negligible.
• The tax is paid at a rate of 10 percent on the basis reduced by 30%,
• The landlord does not pay tourist tax, membership fees
• The landlord does not pay a brokerage commission.
• Landlord does not pay utilities, cleaning
• The landlord does not pay. RTV fee
• The landlord does not come for inspection.
Autogosts save the tourist season
The world is changing, it is divided into East and West, Croatian tourism is returning to traditional markets. In the pandemic years and in this 2022, "drive-in" destinations have the advantage, and those that are as close as possible to the starting point. The car is also a means of consumption in Croatia (tolls, fuel, ferries, parking, car washes, filling stations...) Significant quantities of domestic products such as olive oil, wine, cheese, prosciutto... are exported by car.
Imagine if 6 bottles of wine and olive oil for "self-export" were placed in each trunk of 2 million vehicles. The car is a "container" that comes to collect the goods by itself, loads them and drives to the final destination, pays for the goods immediately upon collection, at the retail price in cash... This is the dream of every good seller.
Family accommodation and demographics
Family accommodation contributes to household income when other, basic incomes such as wages and pensions are insufficient. If we can ensure a good standard of living and an income with which we can pay all our obligations and still travel the world as free people and not hired workers, why wouldn't we opt for such an approach? The Croatian coast and islands would have been depopulated long ago if it weren't for tourism, especially family tourism.
The survival of rural communities is threatened throughout Europe. Family tourism is recognized as an efficient "tool" for improving life in rural areas. Thanks to the combination of primary economic activities and tourism, even in rural areas it is possible to reach a standard of living that was once possible only in cities. Through tourist traffic, the municipality participates in significantly higher revenues, so investments in a higher communal standard become possible. Tourism needs good final products such as processed milk, meat and dried meat products, woolen clothes, wooden furniture, but also digital devices and programs and the like. Because of the demand created by tourism, primary economic activities are also being improved. Final products of good quality and design achieve a good price and become sought after outside the tourist area. In a way, tourism is a "sponsor" of the development of many products and services that, through placement in tourism, "grow" and become attractive for the wider market.
Remote work and digital nomads are a new opportunity for the revitalization of rural areas. By 2035, according to forecasts, one billion people will live as digital nomads. Remote work is beneficial for young people living in the country, creating the possibility of young people returning and the possibility of nomads arriving. Family accommodation, apartments, holiday homes are most often chosen. Proximity to a larger city, spending time in nature, and opportunities for recreation in nature are important. Healthy food is sought after - fresh fruit and vegetables, so linking agriculture with tourism, especially vegetable and fruit growing, is a given.
Opportunity for new vocational schools that combine hospitality and tourism
There are 100.000 households registered for catering services in Croatia. If we have just one child in each household, that is 100.000 children with a predisposition to learn catering skills (If we also include the Western Balkan countries from which young people would like to study in an EU country where they can communicate more easily and already have acquaintances and friends, this number is many times higher).
A new approach is needed – a hotel school, modeled after Switzerland, Austria, Bavaria, Italy (https://www.lhfs-bruneck.berufsschule.it/de/home). The Austrian Chamber of Commerce also has world-renowned vocational schools. The Tourism Academy teaches young people all the knowledge and skills a hotel needs: (https://www.tourismus-akademie.at/de/ueber-uns/).
Partnership for the future
It is extremely good news that the co-organizer of the 8th Istrian County Family Accommodation Forum is the School of Tourism, Hospitality and Trade Pula, and one of the lecturers was Mrs. Gordana Nikolić, Dean of the College of Business. BY Rijeka. The main organizer is the Croatian Chamber of Commerce Pula, headed by its president Jasna Jaklin Majetić.
We need this kind of partnership to create new staff in tourism, young people who know how to clean a room, cook a meal, mix drinks, use digital marketing... who can function anywhere in the hospitality and tourism industry and eventually become top experts.
Work in a hotel and have extra income
We remember the times when we were educated on scholarships, worked every summer in tourism, were employed indefinitely and used our days off in the winter to pay for overtime in the summer. We sold our agricultural products to the hotel where we worked, and the hotel "filled our accommodation" through its home-made reception. The total income was such that we did not need to emigrate to another country, even though salaries in tourism were then, as they are today, significantly lower than the average in the economy. This was, and can still be, a recipe for retaining a quality workforce in tourism and for stopping negative demographic trends in society.
Sustainable and responsible tourism takes into account the needs of the local community, includes the local community, includes local products, and includes local, traditional, and cultural values.
A hotel cannot carry an eco certificate if it does not employ at least 50% of its staff from the local community and does not comply with all of the above as well as a whole series of conditions from the environmental care agenda.
Coexistence and cooperation for the benefit of all
Instead of the antagonisms that have developed over the last 30 years, sustainable tourism needs cooperation,
coexistence of the local community, small and large entrepreneurs in tourism, government and academia on an equal footing. This is the recipe for a successful future. Changes are inexorable, – climatic, energy, geopolitical, social, economic… Croatia is not and cannot be an exception. In times of crisis, we need to “put our heads together”.
