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The European Commission will propose new housing rules that would give national and local authorities clearer rules for restricting short-term holiday rentals and the purchase of homes or land that are not used as someone’s main home, according to a document seen by Euronews.
The prospect of a tougher crackdown comes as prices have skyrocketed faster than local incomes across most European capitals, rising 64.9% between 2015 and 2025 and rents 21.8%, according to EU data.
Even people who cannot afford to buy are facing rising rents, which consume 40% of household income, and middle-class families are also increasingly facing a reality where they can’t afford to buy or rent, but also aren’t eligible for social housing.
Many residents in cities like Lisbon, Barcelona and Prague complain that short-term rental platforms like Airbnb have removed homes from the market and pushed prices up, often forcing them to move. EU data from 2024 reveals that nearly 10% of people living in EU cities spend more than 40% of their disposable income on housing.
Short-term rentals represent only 1.2% of the EU’s total housing stock, but they can account for up to 20% in some tourism hotspots. With too few homes being built where demand is strongest, Brussels estimates it needs more than 2 million new homes every year to fix the problem.
However, the Commission’s upcoming restrictions would be allowed only in areas with clear evidence of serious housing pressure.
For Airbnb-style rentals, the EU is particularly concerned about commercial operators running several properties as holiday lets, rather than people occasionally renting out their own home. Under the proposal, cities would be able to target professional multi-property operators, but a person’s ability to rent out their main residence would be protected.
“In order to limit the negative impact on the internal market of any measure restricting access to, or the provision of, short-term accommodation rental services or restricting acquisition and use of land and residential property, such measures should be limited to areas where the acute pressure on the availability and affordability of residential property justifies action to safeguard affordability and availability of residential property,” reads the document.
However, the Commission acknowledges that short-term rental restrictions and limits on second homes can’t solve Europe’s structural housing shortage. Other challenges include high construction costs, expensive land, planning restrictions and lengthy permitting processes.
According to Housing Europe, the Brussels-based European Federation of Public, Cooperative and Social Housing, housing needs far exceed supply. Latest data show that France requires 518,000 homes annually (198,000 social), Germany 400,000 (140,000 social), the Netherlands nearly 1 million by 2031, and Sweden over 500,000 by 2033 – yet new provision consistently falls short of need, often by as much as 50%.
The Commission is working on a “Housing Simplification Package” aimed at cutting administrative barriers that slow down construction due in 2027.
Housing has also become an investment asset, making it increasingly difficult for younger people and middle-income households to buy.
EU lawmaker Leïla Chaibi (The Left/ France) told Housing Commissioner Dan Jørgensen on 2 September that financialisation and the widespread use of housing as an asset are among the main drivers of the lack of affordable housing in EU cities.
“It is time for the EU to act, and we know short-term rentals have an impact on the housing crisis, in our city centres, in our neighborhoods, as well as in the countryside everywhere in Europe now,” Chaibi said.
The Commission is also considering encouraging national governments to step in when a particular area has house prices at least eight times higher than incomes, prices have risen over the previous decade, and the situation is not expected to improve within the next three years.
Housing is a national and local responsibility, leaving the Commission powerless to order member states or cities to build more of it. Instead, Brussels is trying to use EU funding, state-aid rules, investment and legislation to influence the market.
Commenting on a 2025 S&D study on short-term rentals, EU lawmaker Gaby Bischoff (S&D/Germany), vice-president for Sustainable Economy and Social Europe, warned that too many Europeans are facing evictions or are even at risk of homelessness. She attributed the crisis to growing socio-economic inequality and unsustainable housing systems that “prioritise profit over people”.
An estimated 1.2 to 1.3 million people experience homelessness across the EU on any given night, driven heavily by the deepening housing crisis and rising living costs, according to the European Federation of National Associations on Homelessness (Feantsa).
The Commission is set to present its housing plan on 9 September.
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