'Mid-term rentals': the new haven for investors to keep ahead of housing regulations

Overview of the Article

The piece, published by EUobserver and authored by journalist Sergi Pijuan, examines how mid‑term rentals—leases lasting from 30 days up to a year—are emerging as a lucrative alternative for investors amid tightening regulations on short‑term platforms such as Airbnb. It contextualises the shift within broader European housing challenges, highlighting the tension between tourism‑driven accommodation and the need for sustainable, long‑term housing solutions.

Short‑Term Rentals and Housing Pressure

Short‑term rentals have proliferated across major city centres, with Paris hosting over 91 000 listings, Rome nearly 35 000, and Florence around 12 000. In some markets, they constitute a significant share of housing stock: 20 % in Madrid, 10 % in Barcelona, and up to 85 % in Málaga. Studies show 50‑70 % of accommodations in eight Southern European cities are managed by hosts with multiple properties, indicating a commercial rather than sharing‑economy model. This concentration has intensified housing shortages, especially in historic districts.

Regulatory Responses Across Europe

Local authorities have introduced measures such as licensing requirements (Athens, Barcelona), night‑cap limits (Amsterdam, Paris), and mandatory registration of hosts. In Spain, 84 % of entire‑unit listings in Madrid lack a licence number, prompting the consumer‑affairs ministry to order the removal of over 65 000 illegal short‑term listings. Night‑cap caps range from 30 to 120 nights per year, and safety standards now ban windowless basements and unrenovated warehouses in Athens. The EU’s Regulation 2024/1028, effective from 2026, will require state‑level data collection on short‑term rentals.

Rise of Mid‑Term Rentals as a Legal Gap

Mid‑term rentals exploit a regulatory gap: stays longer than 30 days often escape the licensing and night‑cap rules applied to short‑term lets. France’s “Bail Mobilité” contract, introduced in 2018, allows fully‑furnished rentals of 30 days to one year without licences, zoning restrictions, or tourist taxes. During the Paris Olympics, some properties earned up to €2 500 for a three‑night stay under this model. In Berlin, 64‑70 % of listings in high‑demand neighbourhoods are now temporary rentals; in Barcelona, their share rose from 1.9 % in 2018 to 7.1 % in 2023. Overall, mid‑term rentals represent 42 % of listings on non‑niche platforms in 2024, a 48 % increase from the previous year.

Investor Strategies and Market Impact

Companies such as Blueground and Ukio acquire long‑term leases from owners and sublet them as mid‑term rentals, often advertising on Airbnb alongside dedicated platforms. This model offers investors higher yields, lower turnover costs, and fewer regulatory hurdles compared with short‑term tourism rentals. The trend aligns with growing student and mobile‑worker mobility, especially post‑COVID‑19, and with policy shifts that restrict long‑term rental pricing, pushing landlords toward the mid‑term niche.

Implications for Sustainable Housing

While mid‑term rentals provide a flexible housing option for transient populations, they also risk further reducing the pool of long‑term homes for permanent residents, potentially exacerbating the housing crisis. Policymakers are urged to adopt a coherent, Europe‑wide regulatory framework that balances investor incentives with the need for affordable, sustainable housing. The European Housing Action Plan calls for coordinated rules to keep urban housing accessible and functional, especially in high‑demand cities.