New powers for cities and local authorities to impose restrictions on short-term rentals are provided for in the draft Affordable Housing Act revealed by Euractiv. Restrictions will only be allowed when it is demonstrated that tourist rentals are putting pressure on the housing market.
A new European framework to restrict short-term rentals in areas facing severe housing pressure is being prepared by the European Commission. The draft Affordable Housing Act, obtained by Euractiv, provides for the creation of common European rules allowing national and local authorities to restrict the use or purchase of homes and land for non-primary residence.
The proposal does not transfer responsibility for housing policy to Brussels. Instead, it seeks to establish common rules on when and under what conditions cities can intervene in the short-term rental market.
“Housing stress”: Which areas could be targeted
A central concept of the new framework is an area experiencing “housing stress”. National and local authorities will be able to designate an area as such based on specific indicators, including the relationship between housing prices and incomes. However, high property prices alone will not be sufficient.
To impose restrictions on short-term rentals, authorities will have to demonstrate that these have worsened housing availability or affordability for at least three years. In this way, the European Commission seeks to link restrictions to actual data from the local market and limit challenges to them under single market rules.
Different treatment for primary residences
The draft makes a clear distinction between the occasional rental of a primary residence and the systematic operation of homes as tourist accommodation. Short-term rentals of primary residences are excluded from this framework, as, according to the Commission, they do not generally remove homes from the long-term rental market. The focus is therefore primarily on properties that are converted into tourist rentals and cease to be available to permanent residents.
European Commission: Restrictions alone will not solve the problem
The Commission itself acknowledges that putting the “brake” on short-term rentals is not a solution to the housing crisis on its own. The draft stresses that restrictions must be accompanied by policies that increase housing supply: new construction, renovations and the return of vacant properties to the market.
This approach forms part of the broader European strategy to address the housing crisis. The Commission has already pointed out that short-term rental activity increased by 93% between 2018 and 2024.
Pressure on Paris, Barcelona, Milan
The discussion is particularly important for major European cities and popular tourist destinations, where demand for housing has increased significantly. Cities such as Paris, Barcelona and Milan have already introduced or are considering measures against the spread of short-term rentals, as local authorities view the loss of homes from the long-term market as one of the factors exacerbating the crisis. The problem is even more pronounced in some tourist destinations, where short-term rentals can account for a much larger share of the total housing stock.
Platforms already push back
The new initiative is expected to open a new front between the European Commission and the digital platform industry. CCIA Europe, which includes Airbnb, has already called on the Commission not to introduce new rules before sufficient data is available from the European framework for short-term rentals, which came into force in May 2026. The industry argues that the EU risks creating another layer of regulation before the existing regulatory framework can be assessed in practice.
The next step
The Affordable Housing Act is expected to be presented on September 9 by Housing Commissioner Dan Jørgensen and Executive Vice-President of the Commission Teresa Ribera. The essence of the new proposal is clear: cities will have greater scope to restrict short-term rentals, but they will first have to demonstrate that there is genuine and persistent housing pressure and that tourist rentals are contributing to it.
