Calls Mount for EU to Regulate Short-Term Rentals in Response to Housing Crisis

A new study has urged the European Union to implement regulation of the short-term rental sector, emphasizing that it should be done “in a balanced manner.”

The legislative proposal seeks to address current gaps in oversight within a rapidly growing industry, which is contributing to housing shortages, rising rents, displacement of residents, online discrimination, and insufficient consumer safety standards across the EU.

Rather than portraying short-term rental platforms as inherently negative, the study acknowledges their contribution to local economies and the tourism sector.

However, housing markets in many parts of Europe are increasingly strained, and high-tourism destinations are experiencing saturation. As a result, Members of the European Parliament (MEPs) argue it’s time for a unified regulatory framework at the EU level. The proposals outlined in the study aim to deliver legal clarity and proportionate safeguards, particularly for urban areas dealing with over-tourism and housing scarcity.

According to the Socialists and Democrats (S&D) Group, the purpose of the study is to “provide legal clarity and certainty to cities, and empower them in managing the current crisis.”

Gaby Bischoff, S&D Vice-President for Sustainable Economy and Social Europe, stated: “In 2023 alone, 719 million nights were booked through short-term rental platforms in the EU. In many cities, this has had devastating effects on the availability of long-term rentals, driving housing shortages and accelerating gentrification. For instance, in Florence, 20% of central flats are listed on Airbnb. It is time for the EU to act!”

She added: “The European Union is currently grappling with an acute housing crisis. Many people with low to medium incomes are struggling with affordability due to a 48% average increase in housing costs in the EU between 2015 and 2023.”

“Too many Europeans are facing evictions or are at real risk of homelessness,” Bischoff continued. “This crisis stems from deepening socio-economic inequality and an unsustainable housing market that puts profit before people.”

“With this legislative proposal, we offer a viable and balanced solution. We urge the European Commission to take action and move forward with regulation of the short-term rental market. There’s a clear need for EU-level intervention. Our goal is not to ban platforms outright, but to address market imbalances—particularly in cities like Lisbon, Porto, and Barcelona, where over 70% of listings are controlled by multi-property hosts.”

“Our study shows that EU member states could introduce measures such as night limits, authorization systems, and zoning restrictions in areas under severe housing pressure. The proposal also suggests different rules for non-professional and professional hosts, to preserve true peer-to-peer sharing while curbing disruptive practices by large-scale commercial operators.”

Laura Ballarín, S&D MEP and coordinator on the Committee on Internal Market and Consumer Protection, added: “Short-term rentals originated as part of the collaborative economy and initially created positive outcomes, particularly for tourists and private hosts seeking extra income.”

“However, the exponential growth of these platforms has brought a variety of negative side effects—impacting consumers, residents, and small businesses alike,” she concluded.