The European Commission will next year propose new measures to tackle short-term rentals as part of a plan to deal with the housing crisis in Europe and boost the availability of affordable homes.
Housing is considered to be an area of national competence but the EU executive says that “with an average increase of house prices by more than 60%, and of rents by more than 20% in the past 10 years, millions of Europeans are struggling to find a home they can afford”.
This “hurts labour mobility, access to education, and family formation,” the commission said.
The package of measures announced on Tuesday aims to increase housing supply through more investment, planning and reforms, and support for innovative construction and renovation.
A key element of the plan is the relaxation of EU state aid rules, which were designed to prevent national governments from giving financial advantages to companies in order to avoid unfair competition.
The commission proposed to revise the rules to include affordable housing in some categories and so make it easier for member states to support affordable and social housing projects.
Utrecht housing chief Dennis de Vries said the change in state aid rules is crucial. “Every country is different, and national competences vary across member states,” he said. “To make it work, you have to account for the differences in Europe.”
The relaxation of state aid rules will make it easier for the Dutch government to support housing corporations, which are the primary providers of social housing in the country.
The plan will also target short-term and holiday rentals “in areas under housing stress”.
Short-term rentals across Europe grew by almost 93% between 2018 and 2024, and in popular destinations they now represent 20% of the housing stock, the commission said.
“We cannot sit back while local citizens are pushed out of the housing market in the places where they were born or where they want to build their life,” energy and housing commissioner Dan Jørgensen said, while announcing the plans in the European parliament.
“Short term rentals is, as such, not a bad idea,” he said. ‘For some people the income they can get from renting out their homes might be what actually makes it possible for them to stay in their home… but when we see people not being able to live in certain areas of a city because prices have gone up pushed by short term rentals… then, of course, it is a problem”.
The new rules will address competition between professional hosts with traditional accommodation providers, who have to comply with stricter safety and consumer protection requirements, the commission said.
An existing EU regulation becoming effective in May 2026 requires the registration of hosts and the sharing of data with national authorities.
House prices
Jaume Collboni, mayor of Barcelona and deputy president of Eurocities, the organisation representing cities in Brussels, said the plan “represents a turning point for Europe’s housing crisis.”
According to the commission analysis, housing demand in the EU is expected to grow by more than two million units per year, mainly in urban areas. One million homes will be needed in the Netherlands by 2031.
In several European cities essential workers, such as teachers, nurses and police officers, cannot afford to live in the communities where they work and young people are pushed out of the market, the commission noted.
Only three member states – the Netherlands, Austria and Denmark – have more than 20% of their housing stock classified as social housing. In the Netherlands, the proportion was 34% in 2021 while the EU average is 6-7%.