Commission to present the Affordable Housing Act next week
EU member states would have to debate the proposal before it becomes law
Residents in tourist hotspots have protested against surge in holiday rentals

By Foo Yun Chee

BRUSSELS, Sept 4 (Reuters) - Airbnb (ABNB.O) and other short-term home rental companies face new restrictions as the European Union seeks to tackle a shortage of affordable housing in tourism hotspots, according to a European Commission proposal seen by Reuters.

The EU is seeking to harmonise rules across Europe after authorities in cities including Paris, Barcelona and Venice cracked down on Airbnb.

Residents, especially young Europeans hit hardest by the housing crisis due to the surge in short-term holiday rentals, have also taken to the streets to protest.

European Commission Vice-President Teresa Ribera will present the Affordable Housing Act on September 9, which will then need to be debated by EU countries and European Parliament in the coming months before it can become law.

HOW TO DEFINE A HOUSING SQUEEZE

The proposal sets out criteria for determining what constitutes a housing squeeze that would justify curbs on short-term rentals.

Authorities “should assess housing stress in the area concerned on the basis of the price-to-income ratio and its growth across time together with other indicators that allow to demonstrate that housing stress is unlikely to ease in the future,” the draft said.

“The price-to-income ratio measures the affordability of housing by comparing the cost of acquiring a dwelling with the earnings of the household or population that is expected to purchase it,” it said.

It said authorities should also assess population growth and housing supply and demand trends and that any measure should be non-discriminatory, proportionate and in the public interest.

The proposal said quantitative caps in areas facing a housing crunch or grandfathering rules, which allow those already operating to continue to abide by existing regulations, could be more appropriate than a ban on acquisitions or use of property.

Lobbying group CCIA, whose members include Airbnb, said the Commission should monitor national and local restrictions and resist disproportionate curbs.

“Without enforceable proportionality checks, the Affordable Housing Act would serve no one well, not the homeowners who let a room to help make ends meet, not the regions and industries that live from tourism,” it said in a statement.

The Affordable Housing Act follows the EU short-term rental data regulation, which took effect in May this year and requires short-term rental companies to share data with governments across Europe so they can monitor listings and flag non-compliant ones.