The Wild West Days of Short-Term Rentals Are Ending. What Comes Next?

There was a time when short-term rentals felt a little bit like the Wild West and in some places, they still do!

Hosts could list a property on an OTA, welcome guests, and get on with running their business without worrying too much about registration numbers, licensing schemes, tourist taxes, data sharing requirements, zoning restrictions, compliance paperwork or even, dare I say it, safety regulations.

Those days are rapidly disappearing.

Around the world, governments are introducing new rules for short-term rentals.

Whether you agree with these changes or not, one thing is becoming clear: regulation is no longer the exception. It is becoming part of everyday life for short-term rental hosts.

When the STR business really took off with the birth of Airbnb, it operated with very few rules, oversight or sheriffs to police it.  Over the past 15 years, the market has exploded as homeowners, investors, and entrepreneurs realized the income potential of short-term rentals. The tourist boom, especially since the Covid-19 pandemic, has seen towns and cities bulge with tourists as property owners and investors rush to take advantage of the business opportunity.  Unfortunately, it has triggered a series of negative consequences that have raised more than a few eyebrows:-

• Locals were forced out of towns as affordable housing options declined
• Rising tourism demand has contributed to higher prices in some destinations.
• In some regions, concerns have been raised about the impact of tourism on water and other local resources.
• Overtourism has caused severe crowding, traffic congestion and limited parking in many towns, cities and at tourist attractions
• There is inevitable additional pressure on urban infrastructure with increased noise complaints and disturbances in residential neighborhoods and apartment blocks
• Ultimately, there is an added strain on local services and councils to manage waste collection, road management and public services

The result is that there is now more regulation in more places than ever before with even more punitive consequences for those that ignore the rules.

The most recent examples (May 2026) come from Europe and the UK.  New EU regulations have come into force across the member states of the European Union requiring hosts to register properties and display identification numbers on listings while at the same time, OTAs are required to share data with the European authorities about the listings – specifically about occupancy and income. In England, tourist taxes are likely to be introduced in many places (mimicking Wales and Scotland) and registration will become compulsory toward the end of the year.

On the other side of the pond in the USA and Canada; there is more regulation in the USA at city level, but a growing battle over how much control local governments should have.  Advocacy groups, together with the OTAs are pushing back.  Canada appears to be moving firmly toward tighter regulation, particularly where governments believe short-term rentals are affecting housing supply.

In emerging and growing markets; in Brazil, they are moving in this direction, but not yet experiencing the same level of regulatory pressure seen in Europe and Canada.  And India’s focus currently appears to be on registration, tourism oversight, and formalizing the sector rather than imposing widespread restrictions.

While the details differ from country to country, the direction of travel is remarkably similar.

The Wild West may not be completely over yet, but the sheriff is definitely riding into town.

The good news about regulation? It helps drive the cowboys out.

Every industry has its bad actors, and short-term rentals are no exception.

Effective regulation can help reduce the number of low-quality, poorly managed properties, creating a more professional and sustainable market.

It also helps level the playing field for responsible hosts, raises quality and safety standards, and improves the reputation of the industry as a whole. Perhaps most importantly, it can foster better relationships between short-term rental operators and the local communities in which they operate.

But with the good, inevitably comes the bad; more paperwork, more complexity, and more costs. If your property is located where you have time restrictions (ie: only 90 days per year), you’ll also need to carefully manage your calendar so as not to breach the regulation limit, especially if you have to juggle bookings from several platforms.
For many hosts, the biggest frustration is not the regulation itself, but the constant need to keep up with changing rules and requirements.

For independent hosts, the ugliest aspect of regulation is when a host with one property is treated exactly the same as a company managing 250 rentals.

Many independent hosts have spent years quietly running a holiday cottage, apartment, or guest house, providing excellent hospitality, supporting the local economy, and operating responsibly. Then suddenly, because of rapid growth in the wider market, they find themselves facing the same regulations, restrictions, licensing requirements, and compliance obligations as large commercial operators.

Many hosts feel that isn’t entirely fair.

The other ugly side of regulation is that rules can sometimes become overly complex, inconsistent, or highly restrictive. In some cases, they can affect not only hosts, but also the wider network of local businesses, tradespeople, restaurants, attractions, and service providers that benefit from tourism.

This is where advocacy groups come into their own.

Advocacy groups exist to represent the interests of hosts, property managers, and the wider short-term rental industry. They work with governments, tourism bodies, local authorities, and policymakers to help ensure that new regulations are fair, practical, and based on evidence rather than perception.

In Chapter 6 of my book, 5-Star Hosting Made Simple, I discuss the role these organizations play and provide a list of advocacy groups around the world. (You can download the list below and find your local group.)

At the same time, there are examples that help explain why regulation is gaining support.

A family member who lives in a private apartment building in London recently experienced a serious disturbance when one short-term rental was allegedly used to host a rave attended by hundreds of people. Residents reported significant disruption, concerns about safety, and police intervention.

Incidents like these damage the reputation of the entire industry and strengthen calls for greater oversight, even among people who would otherwise support tourism and short-term rentals.

The challenge for governments is finding the right balance: tackling irresponsible operators without unfairly penalizing the thousands of hosts who are running legitimate, professional businesses.

So, what should you do if the sheriff is riding into town?

My advice is simple:

✔ Understand and follow your local rules and regulations
✔ Stay informed about upcoming changes
✔ Keep good records
✔ Operate professionally
✔ Focus on hospitality and guest experience
✔ Build positive relationships within your local community
✔ Connect with your local advocacy group and support their efforts

Most importantly, don’t wait until new regulations arrive on your doorstep. The hosts who adapt early are usually the ones who experience the least disruption when change comes. Hosts who assume that regulations will never be enforced may be taking a significant risk.

A recent example comes from Porto, Portugal, where more than 1,400 Alojamento Local (short-term rental) registrations were canceled after operators failed to provide proof of mandatory civil liability insurance. This was not a sudden change. Operators had been notified of the requirement and given time to comply, yet many failed to respond. According to reports, a significant number of the canceled registrations were located in Porto’s historic center, where current containment rules may prevent some operators from ever reactivating their tourist accommodation licenses.

Whether you agree with the policy or not, the message for hosts is clear: staying informed and remaining compliant is becoming increasingly important in today’s regulatory environment.

The Wild West days of short-term rentals may be fading, but that doesn’t mean opportunity is disappearing. If anything, the hosts most likely to succeed in the years ahead will be those who adapt early, operate professionally, build trust within their communities, and continue to put hospitality at the heart of their business.

If you’d like a free list of advocacy organizations representing short-term rental hosts around the world, including Rent Responsibly and many others, you can download it here