The EU’s Transformative Short-term Rental Regulation

Short-term rentals have become increasingly controversial as housing affordability pressures intensify across cities and regions worldwide. Municipalities, including Barcelona and New York City, have responded with a wide range of regulatory approaches. Because housing policy is inherently local, short-term rental regulation has developed in fragmented ways, resulting in inconsistent approaches and enforcement.

In the European Union, this fragmentation will change in May when the EU Short-Term Rental Regulation (EUSTRR) takes effect. The regulation imposes harmonized short-term rental registration and platform data sharing requirements across all 27 EU member states, making it the most comprehensive short-term rental regulation to date.

The EUSTRR’s core innovation lies in a standardized regulatory infrastructure. By harmonizing administrative rules at the EU level while leaving substantive restrictions to local authorities, the regulation addresses a central tension in short-term rental governance: Local housing conditions demand local solutions, yet subjecting global platforms to thousands of divergent compliance regimes is neither workable nor compatible with established platform liability standards.

The EU resolves this tension through a layered approach. At the EU level, the EUSTRR standardizes online registration procedures and imposes uniform data-sharing obligations on short-term rental platforms. Each of the estimated 4 million short-term rental properties subject to a registration scheme will receive a unique registration number, and platforms will transmit standardized monthly activity data to public authorities through national interfaces.

Substantive rules—geographic restrictions, night-caps, quotas, or limitations on secondary residences—remain within the competence of local or regional authorities, provided they comply with EU law.

Together with the Digital Services Act (DSA), which governs platform liability, the EUSTRR provides the enforcement infrastructure through which those local rules can be effectively applied. Within this framework, authorities, hosts, and platforms assume distinct but interlocking roles, creating an end-to-end process from property listing to potential removal for violations of local rules.

Member states that choose to regulate short-term rentals and wish to receive platform data must establish online registration procedures that comply with EUSTRR requirements. Registration numbers are issued automatically upon the host’s submission of standardized information, with verification occurring afterward. Existing registration schemes may continue, provided they conform to the regulation’s procedural standards.

Authorities must also establish centralized national application programming interfaces to facilitate data exchange with platforms and maintain publicly accessible lists of areas where registration requirements apply. Authorities retain responsibility for monitoring compliance and enforcement. Any additional information requirements imposed for health, safety, or consumer protection purposes may not condition registration itself. Under the DSA, competent authorities may request information from platforms or order the removal of listings that fail to comply with applicable rules.

The EUSTRR imposes several obligations on hosts. When registration is required, hosts must register online and provide standardized information, including the precise address and identifying details of the unit, its type, maximum capacity, and whether it constitutes a primary or secondary residence. Natural persons must supply identification and contact information, and legal entities must provide business registration details.

Hosts must also furnish registration numbers to platforms and ensure the accuracy of all submitted information. If separate authorization schemes apply, hosts must confirm compliance with the relevant authorities. Responsibility for complying with substantive local requirements, such as night-caps, capacity limits, or building regulations, remains with the host.

The EUSTRR also creates obligations for housing platforms. When hosts declare that a registration scheme applies, platforms must collect registration numbers and required host information before listing properties and must clearly display registration numbers on listings. Platforms are also required to assess the completeness of host declarations and conduct random compliance checks using application programming interfaces of individual member states.

In addition, platforms must transmit standardized monthly activity data to authorities, including unit addresses, registration numbers, nights rented, guest numbers, countries of residence, and listing website addresses. Upon receipt of valid requests under the DSA, platforms must remove non-compliant listings and direct hosts to the applicable local rules.

By requiring registration before listing and standardized monthly reporting thereafter, the EUSTRR enables significantly more effective and timely enforcement. Authorities gain systematic visibility into short-term rental activity, reducing reliance on complaints, ad hoc investigations, or data scraping. Because each listing is uniquely traceable through the EUSTRR registration identifier, authorities can verify compliance with local rules and pursue delisting when violations occur. At an aggregate level, the activity data also supports ongoing monitoring of market dynamics and enforcement outcomes.

This enhanced data availability has important implications for substantive short-term rental regulation. Under the principle of subsidiarity, substantive housing restrictions remain primarily within local or regional competence. At the same time, the EU Services Directive, which safeguards the free establishment of services across the EU, requires that restrictions on the provision of services be justified by a recognized public interest objective, such as housing affordability, and satisfy the requirements of necessity and proportionality.

The Court of Justice of the European Union has emphasized consistently the central role of empirical evidence in assessing whether such restrictions are justified. Authorities must demonstrate a causal link between the identified public interest objective and short-term rental activity. The European Commission’s 2024 rejection of proposed legislation restricting short-term rental activity illustrates this requirement, as the Commission concluded that the authorities had failed to substantiate a sufficient connection between short-term rentals and pressure on the long-term rental market.

The EUSTRR materially alters these evidentiary standards. Prior to its adoption, authorities and researchers relied heavily on proxy measures and scraped platform data, producing variable and often inconclusive estimates of short-term rental impacts. In contrast, the property-level activity data mandated by the EUSTRR enables rigorous empirical analysis of actual market conditions. This development both empowers and constrains regulators: It facilitates the design of targeted, proportionate interventions grounded in demonstrable effects and simultaneously raises the evidentiary bar authorities must meet to justify restrictive measures.

Ultimately, the EUSTRR will transform the EU’s short-term rental regulatory environment by establishing a layered model that addresses the tension between local housing conditions and global platforms. By mandating comprehensive data collection, the EUSTRR offers a framework for evidence-based policymaking that jurisdictions worldwide will closely examine.

Ben Schroeter is the director for economic policy at Booking.com.

Christine Mukamayanja is the public affairs manager for short-term rental policy at Booking.com.