The centres of Europe’s cities have become the epicentre of an escalating conflict between residents, governments, and short-term rental platforms such as Airbnb, Vrbo, and Booking.com. The Financial Times article (“Why holiday rentals are winning the war for Europe’s city centres“) chronicles the intensity of this battle, the opposing interests, and the resilience of the short-term rental industry in the face of bans, restrictions, and public outcry.
Residents resist, but bookings rise
Lisbon’s case is illustrative. Despite ongoing protests since 2019 and the city council’s attempt to restrict Airbnb permits in historic neighbourhoods, housing access has worsened. According to AirDNA, bookings in 2023 reached 90% of pre-pandemic levels. Activist António Gori describes the situation as a “joke,” with the housing crisis now affecting the middle class.
In Spain, tensions are equally high. Thousands have protested in Madrid and other tourism hotspots, demanding the removal of Airbnb from residential neighbourhoods. In Rome, activists glued shut the lockboxes of rental apartments. Greece’s Tourism Minister Olga Kefalogianni announced a one-year moratorium on new registrations in Athens, stressing the need for a balance between economic benefit and housing access.
Barcelona’s radical move: A full ban
Barcelona is pushing ahead with a radical solution: banning all short-term rentals by 2028. The city hasn’t issued new permits since 2014 and currently has around 10,000 tourist apartments slated for removal. The European Commission has expressed concerns, stating the policy is “not suitable” for tackling housing shortages. According to PwC, rents in Barcelona surged by 72% over the past decade — far outpacing wage growth.
The Spanish Constitutional Court upheld the city’s plan last month, despite opposition from the rental sector. Marian Muro, director-general of Apartur, argues that tourist apartments represent 40% of the city’s accommodation stock and that bans drive up hotel prices, limiting access to affordable travel.
Venice: Tourism and depopulation
Venice welcomes roughly 30 million tourists annually, yet in 2024, short-term rental nights hit 1.71 million — surpassing the 2019 peak. In some districts, one in three homes is used for holiday rentals.
The resident population has fallen from 175,000 in 1951 to 48,500 in 2024 — a 13% drop in the past decade alone. Housing prices are among the highest in Italy at €4,562/sq m, compared to the national average of €1,801.
Though Venice received a legal green light in 2022 to limit tourist rentals, its proposed 120-day limit per year is widely viewed as inadequate. Local politicians and housing activists call for stricter regulations.
The U.S. experience: New York City
In September 2023, New York City banned rentals under 30 days unless the host is present. The result was swift: Airbnb listings dropped 83% within a year, down to 3,700 by August 2024, while long-term listings grew 33% to 34,300.
Hotel prices surged to $318 per night (+5.7% YoY), with occupancy reaching 84.3%. Yet, housing rent continued rising — by nearly 15% between 2022 and 2024 — mirroring cities like Seattle, Tokyo, and Toronto, which did not impose similar bans. Analysts suggest migration and construction delays are greater drivers of housing costs than short-term rentals.
Other European capitals
Amsterdam capped short-term rentals at 30 nights per year, but rents remain among Europe’s highest — €2,500/month on average in Q1 2025. In Edinburgh, where licensing is costly, rents rose 9.7% YoY to £1,426 in February 2025, compared to Scotland’s 5.8% average.
Dublin has required planning permission for non-primary home rentals since 2019, yet housing conditions worsened. City councillor Conor Reddy, once evicted due to short-term conversion, notes: “The crisis is much worse today.”
Transparency and the road ahead
From May 2026, a new EU regulation will require rental platforms to share data with local authorities — including guest numbers and booked nights. Airbnb has expressed support, hoping transparency will help debunk “myths” around overtourism.
Tourist demand, however, remains resilient. According to Lighthouse, the short-term rental market in Europe remains strong despite local resistance. As Blake Reiter, Head of Hospitality Research at Lighthouse, says: “Holiday homes are so ingrained in European culture — demand isn’t going anywhere.”
This article is based on the Financial Times feature: “Why holiday rentals are winning the war for Europe’s city centres” (April 2025).
