EU sets new rules for limiting short-term rentals
The European Commission is proposing the first joint EU framework under which cities and regions could restrict short-term rental. The measures should be data-driven, proportionate and targeted at areas where housing pressure is evident.
Brussels is not proposing a ban on Airbnb and similar platforms, nor the automatic restriction of private accommodation. Instead, the Affordable Housing Act is intended to set out when local and national authorities can intervene in short-term rentals due to housing shortages and prices. The proposal still has to be agreed upon by the European Parliament and member states.
Eight times annual income threshold
The Commission is proposing a concrete test for identifying areas under housing pressure. The ratio of the average property price to disposable income per capita must be at least eight, meaning the price of an average flat must correspond to at least eight years' income. In addition, the ratio must have shown growth over the past ten years, while authorities also need to assess supply, demand and demographic trends over the next three years.
An expensive housing stock alone will not be sufficient for restricting short-term rentals. A city or region would have to prove that short-term renting has significantly worsened the availability or affordability of housing for at least the preceding three years.
The measures would be introduced for a maximum of five years, after which they would have to be justified again. They could be extended only if the reasons for the intervention still existed.
The primary home largely remains out of reach of the measures
For the tourism sector, the distinction between occasionally renting out one's own home and professionalised short-term letting is particularly important. Under the proposal, restrictions introduced solely to protect housing availability would not apply to accommodation in the host's primary residence. The focus is on properties outside the primary home and activities that, due to their scale or commercial nature, remove flats from the long-term rental stock.
Short-term rentals account for around a quarter of the EU's tourist accommodation supply, and in 2025 alone, online platforms generated 951.6 million overnight stays. At the same time, the share of such properties in the EU's total housing stock is estimated at around 1.21%, but in certain tourist areas it reaches as high as 20%.
Croatian towns and cities are getting a new European framework
For Croatia, the proposal is particularly interesting because the rules for short-term letting have already been made stricter. In multi-apartment buildings, a new short-term let requires the consent of a two-thirds majority of co-owners, including immediate neighbours, while existing landlords have a transitional period to obtain this consent.
The new EU framework will not automatically replace such national regulations. However, in the case of restrictions justified by prices and housing shortages, local data and proof of the proportionality of the measure will carry increasing weight. For Dubrovnik, Split and other destinations with a high proportion of private accommodation, this could shift the debate on regulation away from political assessments and towards a much more precise measurement of the impact of tourism on the housing market.
