For more than a decade, short-term rentals in Europe — and especially in Southern Europe — expanded at a pace rarely seen in other segments of the tourism industry. In the years following the pandemic, the market moved almost automatically: new properties entered the platforms, demand absorbed them, and prices held firm.
In 2025, however, the market entered a clearly different phase. Short-term rentals are not slowing in the sense of retreating, but rather maturing. And that maturity has consequences — not only for investors and operators, but also for cities and local communities hosting this growing supply.
From scale to operations
At the European level, data points to a market that continues to grow, but at a more measured pace, largely due to tighter regulation. Supply growth has moved into single-digit territory, while demand remains resilient. According to AirDNA, supply increased by just 3.5% in 2025, compared with 18.1% in 2024. While supply growth slowed to a more sustainable level, demand continued to rise steadily by 4.4%, resulting in a 0.7% increase in occupancy.
Average daily rates (ADR) across Europe declined by 1.1%, leading to a 0.4% drop in revenue per available rental (RevPAR) despite higher occupancy. At the same time, the Repeat Rent Index (RRI) increased in 10 out of 12 months, averaging a 3% rise. The RRI tracks pricing trends for existing operators, excluding the impact of new listings, and its increase indicates that established properties are retaining pricing power even in a more competitive environment.
This alone reshapes the market’s internal dynamics. Simply being listed on a platform is no longer enough — how a property operates now matters more than ever. Occupancy, ADR, and available nights are no longer independent metrics. They are interconnected, revealing a key reality: as more properties remain active for longer periods throughout the year, competition intensifies — not necessarily during peak season, but during shoulder and low-demand periods. Where the market once tolerated inertia, it now demands strategy.
The mild pricing pressure observed across many European markets does not signal fatigue, but rebalancing. Demand has not disappeared; it has become more selective. Travelers compare options more carefully, return to places where they had good experiences, and show less tolerance for overpriced or poorly managed properties.
Greece on the same path with its own particularities
The Greek market is following the same transition, with some distinct characteristics. In 2025, demand nights grew by 3%, outpacing supply growth of 2%, confirming that Greece remains a highly attractive destination. However, occupancy — while still above the European average of 59% — edged down slightly by 1%, to 60.7%. This was not due to weaker demand, but rather to hosts expanding the operational window of their properties.
This is a subtle yet important shift. Short-term rentals in Greece are gradually becoming less strictly seasonal. More properties are operating for more months of the year, competing for demand during periods that were once considered “off-season.” This dynamic keeps total annual revenue broadly stable, but compresses prices and highlights the growing importance of professional management. ADR declined by 3%, from €143 in 2024 to €139 in 2025.
Here, a critical gap becomes visible. Only a small share of Greek hosts use dynamic pricing or systematic revenue management tools. In a market that is becoming denser and more competitive, this translates into slower reactions and missed opportunities. Performance will no longer be determined solely by the property itself or its location, but increasingly by how it is managed.
The social dimension returns to the foreground
At the same time, the public debate around short-term rentals has shifted. After years of growth-driven enthusiasm, more complex questions are taking center stage: what does this activity mean for housing availability, for neighborhoods, and for everyday urban life?
At the European level, the response is now institutional. Regulation (EU) 2024/1028, which comes into force in May 2026, does not aim to restrict short-term rentals, but to map them. The logic is straightforward: without reliable data, there can be neither effective oversight nor targeted policy.
Public authorities will now have a clear view of which properties are operating, where, and for how long. This strengthens the capacity for intervention — particularly in areas facing housing pressure — while also improving transparency for all market participants.
The Greek case: Less “unknown” than it appears
Unlike many other countries, Greece has already taken meaningful steps in this direction. Mandatory registration in the Short-Term Rental Property Registry has been in place for years, while memoranda of cooperation with major platforms ensure data flows to the tax authorities (AADE). The new European framework is therefore more about harmonization than disruption.
That does not mean the debate is over. As data becomes clearer, local authorities will find it easier to make decisions — whether these involve restrictions, incentives, or spatial differentiation. Experience from other European cities shows that activity rarely disappears altogether, but it often relocates.
A market entering its next phase
The year 2026 does not point to a “difficult” period for short-term rentals. It does, however, signal a more demanding one. For investors and operators, value creation will no longer come automatically from strong demand, but from expertise, data, and operational efficiency. For cities, the challenge will not be prohibition, but balance.
The era of easy growth is over. What follows is the era of choice: who stays in the market, how they operate, and under what conditions they coexist. And this transition — however demanding — may well become the most stable foundation for the next decade of short-term rentals.
