EU unveils plan to rein in short-term rentals amid housing crisis

The European Commission has put forward a proposal to regulate short-term home rental platforms such as Airbnb, in a bid to address the housing shortage gripping popular tourist destinations across Europe.

The draft rules, announced on Wednesday, aim to create a unified European approach to a problem that has seen cities like Paris, Barcelona, and Venice introduce a patchwork of local restrictions, many of which have faced legal challenges from rental companies.

The surge in short-term holiday lets has been blamed for reducing the availability of affordable housing, a grievance that has sparked protests, particularly among younger Europeans.

Commission President Ursula von der Leyen framed the move as a direct response to growing public pressure. "A year ago, I promised to tackle Europe's housing affordability," she said, adding that the plan offers clarity and support to local authorities while staying rooted in local realities.

The proposal introduces the first-ever common European framework for assessing housing measures. Under the plan, authorities could identify areas under housing stress by examining indicators such as high price-to-income ratios or a sustained upward trend in prices over the past decade.

Any restrictions on short-term rentals would need to be evidence-based, proportionate, limited to affected zones, and non-retroactive. The decision to act would remain with local authorities.

The proposal also encourages governments to unlock land for housing and to modernise planning and construction procedures.

However, the plan has drawn criticism from the tech industry. CCIA Europe, a lobbying group whose members include Airbnb, argued that the framework lacks independent oversight. Its head of policy, Alexandre Roure, warned that without independent scrutiny or effective redress mechanisms, the proposal would be a "paper tiger," leaving disproportionate restrictions in place and undermining the legal certainty the broader Affordable Housing Act is meant to provide.

The proposal now requires approval from EU member states and the European Parliament before it can become law, a process expected to take several months.