The European Commission is proposing a new regulatory framework for short-term rentals, which could lead to more serious restrictions on platforms such as Airbnb and other holiday accommodation services. The aim is to give local and national authorities clearer legal tools to intervene in areas where tourist rentals are putting strong pressure on the housing market.
The proposal comes against the backdrop of a deepening housing affordability problem in a number of European cities. According to the European Commission, house prices in the EU have increased by over 60% since 2013, while average rents have increased by around 20%. At the same time, the number of short-term rentals has jumped by 93% between 2018 and 2024.
In the most visited tourist areas, holiday properties can represent up to 20% of the total housing stock, the Commission points out. It is there that the redirection of apartments from the long-term to the tourist market can limit supply for local residents.
What could change
The main idea is for the EU to introduce a common methodology for identifying so-called areas under housing pressure. The assessment could use indicators such as the ratio of property prices to income, population growth, available housing supply and demand.
Once an area has been identified as problematic, local or national authorities will have a more secure legal basis for introducing restrictions on short-term rentals.
Possible measures could include quantitative limits on the number of holiday homes or other restrictions tailored to the specific local market. Brussels will not simply ban Airbnb or Booking.com. Decisions will be made by states and local authorities, but the EU will set clearer rules on when such restrictions are permissible.
Paris, Barcelona and Venice have already tightened the regime
The new European initiative should bring order to the highly fragmented regulation. Cities such as Paris, Barcelona, Venice, Amsterdam, Berlin and Florence already use various combinations of licenses, restrictions on the number of days to rent and bans on new tourist rentals in certain areas.
However, the differences between local regimes have led to numerous legal disputes between owners, platforms and local authorities. It is precisely the lack of sufficiently clear European criteria that has so far hindered cities that wanted to introduce stricter rules.
What does this mean for the property market
The new framework could have direct implications for investors in residential properties in popular tourist cities.
If an area is designated as an area under housing pressure, the future owner will no longer be able to take for granted that the apartment they purchase will be available for unlimited tourist overnight stays.
This could change the profitability and valuation of some investment properties – especially in historical centers, seaside resorts and areas with limited supply of permanent residential properties.
On the other hand, redirecting part of the housing stock to the long-term rental market is precisely the effect sought by the European institutions – more available housing for people who actually live and work in the respective cities.
The proposal is not yet a final law. It must go through the legislative procedure with the participation of the European Parliament and the member states before the new rules become mandatory.
Detailed statistics on average property prices in Bulgaria by cities and neighborhoods can be found at imot.bg