EU gives cities legal cover to restrict Airbnb-style rentals

The European Commission unveiled its Affordable Housing Act on Wednesday, giving local authorities a common legal framework to restrict short-term rentals in areas under severe housing stress. The plan targets tourist hotspots where platforms like Airbnb have reduced long-term supply, but does not compel any city to act.

Bottom line — The Act provides legal certainty for cities but cannot itself build a single home, per the Commission.

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• Short-term rental activity across four major platforms grew 93% between 2018 and 2024, per EU data cited by Euronews and EU Observer.
• An area qualifies as under housing stress if an average home costs at least eight years of disposable per-capita income, per the Commission's methodology reported by EU Reporter.
• Airbnb criticised the plan, saying it 'will not add a single home to the long term rental market' while adding regulatory uncertainty, per a company statement.
• The Commission acknowledged that short-term rentals are not the root cause of the housing crisis, which requires structural solutions like more supply, per EU Reporter and Euronews.
• The Act must now be negotiated by the European Parliament and the Council before approval, per the Commission.
• Committee of the Regions President Kata Tüttő welcomed the step but warned of a contradiction with the EU's proposed budget cuts for local housing investment, per the CoR.

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