EU Prepares New Law to Support Cities' Short-Term Rentals Crackdown
The European Union is drafting a new law under the Affordable Housing Act to help local authorities restrict short-term rentals amidst a housing crisis.
Stock photo for illustration only, not from the actual event
- The EU is preparing a new law under the Affordable Housing Act to help authorities regulate short-term rentals.
- Leaked drafts set specific evidence thresholds, such as home prices exceeding median disposable income by eight times.
- Industry groups argue the move is premature, noting short-term rentals comprise only about 1.2% of total housing stock.
The European Union is advancing preparations for a new legislative measure as part of its upcoming Affordable Housing Act, designed to grant national and local authorities a clearer legal framework to manage short-term rentals like Airbnb in areas facing severe housing stress.
This regulatory push comes in response to a near-doubling of short-term rental bookings across the bloc since 2018, compounded by a broader housing crisis that has seen EU home prices surge by over 60% since 2013, making housing increasingly unaffordable for local residents in major tourist destinations.
The conflict over short-term rentals has long stalled local municipal efforts due to a 2020 EU court ruling requiring restrictions to be strictly justified and proportionate, while leaving the burden of proof to local courts. Establishing centralized evidence thresholds aims to resolve this legal ambiguity and protect municipal regulations from legal challenges.
According to a leaked draft published by European news outlet Euractiv, cities wishing to restrict short-term rentals would need to meet concrete evidence thresholds. These include demonstrating that local home prices are at least eight times the median disposable income and providing documented proof of adverse impacts caused by short-term rentals for a duration of at least three years.
Stock photo for illustration only, not from the actual event
Rather than favoring outright bans, the draft legislation encourages quantitative caps and grandfathering provisions to maintain regulatory proportionality. The European Commission, the executive branch of the bloc, is scheduled to discuss this regulatory mandate during a meeting on September 9, according to preliminary agenda documents.
Meanwhile, major industry trade groups and travel platforms including Airbnb, Booking.com, and Expedia have criticized the initiative as premature. They point out that short-term rentals account for only about 1.2% of total housing stock and emphasize that comprehensive data collection mandated under previous EU rules—with a compliance deadline set for May 2026—has only just begun.
Source: Skift
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