Italy Overtakes France, Denmark, Ireland, Finland, Sweden, Portugal, And More European Countries In Record-Breaking Short-Term Rental Growth Through Airbnb In 2025, Redefining The Future Of Travel Accommodation

Italy overtook France, Denmark, Ireland, Finland, Sweden, Portugal, and more European countries in short-term rental growth through Airbnb, driven by a combination of tourism demand, workforce mobility, and a rising need for transitional housing. While these countries continue to see strong short-term rental activity, Italy’s broader market and diverse usage patterns — including student housing, medical stays, and work relocations — propelled it to the forefront. This surge reflects a deeper shift in how people use flexible accommodation options, reshaping Italy’s housing market and influencing European travel trends in unprecedented ways.
In 2025, Italy has emerged as a leading force in the evolving short-term rental market, overtaking major Western and Northern European countries — including France, Denmark, Ireland, Finland, Sweden, Portugal, and others — in the rapid growth of short-term rental activity through platforms like Airbnb. This marks a significant shift in how travelers, students, workers, and even medical patients utilize short-term accommodations. What started as a trend driven primarily by tourism has evolved into a much more complex and diversified sector, influencing housing markets, urban planning, workforce mobility, student accommodation, and even healthcare logistics. Italy’s surge, however, is not an isolated case. It sits at the heart of a broader European shift in short-term rental activity that has reshaped the continent’s housing ecosystem in 2025.
A Growing Phenomenon: Short-Term Rentals Beyond Tourism
Short-term rental platforms like Airbnb have been experiencing unprecedented activity across Europe in 2025. More than 114 million guests stayed in Airbnb accommodations across the European Union, contributing over €53.2 billion to the EU’s GDP and supporting approximately 904,000 jobs. While tourism is still a major contributor to these figures, the rise of short-term rentals is not just about meeting the needs of tourists. It reflects a much deeper societal shift. More and more individuals are turning to platforms like Airbnb for flexible housing solutions related to work relocations, study opportunities, medical treatments, and temporary living arrangements.
Italy stands out in this transformation, with 84 percent of Italians reporting that they required a temporary housing solution at least once in 2025, a number significantly higher than the 81 percent European average. This growing reliance on short-term rentals to address both personal and professional needs has pushed the issue to the forefront of political debates. As the debate intensifies over housing affordability, regulatory frameworks, and the rights of residents, Italy’s experience offers critical lessons for other European nations.
The Italian Case: From Tourism to Transitional Living
Italy has seen significant growth in its short-term rental market. According to data from the Italian Association of Short-Term Rental Managers (Aigab), short-term rentals accounted for around 1.4 percent of the national housing stock, which equates to roughly 500,000 units out of the 35 million homes across the country. While this may seem like a relatively small percentage at first glance, the concentration of these properties in major urban centers and tourist hotspots has had a significant impact on the availability of long-term housing, especially in cities like Rome, Milan, Florence, and Venice.
What is particularly striking about Italy’s short-term rental market is its use beyond tourism. While Italy is known for attracting millions of international visitors each year, the demand for short-term rentals has surged in response to other needs. Many Italians and international visitors are relying on these flexible living arrangements for purposes other than tourism:
- Searching for a long-term home (27 percent): Many renters use short-term rentals as a stepping stone while they search for a permanent place to live, especially in competitive urban markets.
- Study or education stays (24 percent): With a large number of international students arriving in Italy for higher education, short-term rentals have become an essential option for housing during their academic years.
- Work-related relocations (24 percent): Professionals and workers in transition use short-term rentals as temporary living arrangements before settling into long-term housing.
- Medical treatments (23 percent): Italy’s world-renowned healthcare system attracts many international patients who need short-term housing near major hospitals.
- Vocational training (21 percent): Individuals attending training programs or internships often prefer short-term rentals as they provide flexibility.
This shift toward using short-term rentals for transitional purposes highlights deeper structural issues in Italy’s housing market, where there is an increasing need for affordable, flexible living options that go beyond the typical tourist demand.
Europe’s Airbnb Boom: Countries Rising in 2025
Italy’s surge in short-term rental activity in 2025 did not occur in isolation. Across Europe, many countries recorded significant increases in the number of short-term rentals, but Italy’s expansion outpaced others. Let’s look at how the short-term rental activity played out in other European countries in 2025.
France — A Giant in Tourism, Overtaken in Growth
France has traditionally been a leader in tourism and short-term rental activity. Paris, in particular, has long been a hotspot for short-term rental listings, with Airbnb properties spread across the city. However, Italy outpaced France in overall growth rates of Airbnb activity in 2025. While France continued to see growth in its tourism sector, it was Italy’s ability to cater to a broader demographic — including students, professionals, and medical tourists — that pushed its growth above France’s. This expansion was especially notable in Italy’s southern and central regions, which have seen increased international interest and mobility.
Denmark — Strong Uptick in Guest Nights
Denmark saw a strong uptick in short-term rental guest nights, driven by events, business travel, and cultural tourism, especially in Copenhagen. However, while Denmark’s short-term rental market grew, Italy’s broader usage patterns, which include significant transitional housing demand, enabled it to outstrip Denmark in overall growth. Italy’s large-scale urban centers, combined with its growing tourism and housing needs, positioned it ahead in the competition for short-term rental dominance in Europe.
Ireland — Small Market, Steady Growth
Ireland’s short-term rental market, while growing steadily, is relatively smaller than Italy’s. In 2025, the increase in Airbnb listings in Dublin and other cities was linked to the ongoing tech boom and the city’s popularity among international business professionals. Despite these gains, Italy’s larger market, more diversified in usage, helped it surpass Ireland in total short-term rental growth.
Finland’s Climb — Particularly in Urban Areas
In Finland, cities like Helsinki experienced strong short-term rental growth in 2025, with visitors flocking to experience the city’s cultural and architectural offerings. However, despite Finland’s urban appeal, it was Italy’s massive expansion across both major cities and smaller towns that placed it ahead in the growth race. The higher volume of short-term rental stays in Italy, combined with its rising popularity for non-tourism uses, allowed it to outpace Finland.
Sweden — Urban Demand Drives Growth
Sweden, particularly Stockholm, recorded a solid increase in short-term rental utilization in 2025, as the city remains a hub for business and cultural tourism. Still, Sweden’s growth was not as dramatic as Italy’s. Italy’s multi-faceted demand for short-term rentals, including significant rises in educational stays and medical tourism, gave it an edge over Sweden’s more tourist-driven growth.
Portugal — From Lisbon to the Algarve
Portugal continued to see strong growth in short-term rentals, particularly in Lisbon and the Algarve region, as tourism soared and the country became an increasingly popular destination for digital nomads. While Portugal’s figures were impressive, Italy’s diverse usage patterns and larger market helped it maintain its position at the top of Europe’s short-term rental rankings in 2025.
Other European Countries Experiencing Growth
Apart from the major players listed above, several other European countries have also experienced significant growth in their short-term rental markets in 2025:
- Malta — saw one of the highest year-on-year increases in guest nights, driven by growing tourism demand and its increasing popularity among digital nomads.
- Cyprus — continued to experience growth due to its appeal as a destination for retirees and those seeking holiday properties.
- Germany — major cities like Berlin and Munich saw robust demand for short-term rentals, particularly due to a surge in both international and domestic tourism.
- Greece and Croatia — saw continued surges in listings, particularly in their coastal regions, which are prime spots for summer tourism and long-term stays.
- Latvia, Slovenia, Denmark, and Czechia — reported notable increases in guest nights, demonstrating broader European market expansion.
Why Short-Term Rentals Are Growing Across Europe
Several factors have contributed to the rapid growth of short-term rentals across Europe:
1. Travel Rebound & Tourism Demand
After the pandemic, there was a major surge in leisure and business travel, which led to increased demand for short-term accommodations. Digital platforms like Airbnb captured much of this demand, offering flexibility and options that traditional hotels could not.
2. Economic and Lifestyle Shifts
The rise of remote work, flexible study programs, and growing mobility among individuals has led more people to turn to short-term rentals. This trend is particularly evident among students, workers on assignment, and people needing transitional housing.
3. Major Events
Europe hosted numerous high-profile events in 2025, including the 2026 Winter Olympics in Milan and Cortina. These events drove significant short-term rental demand, particularly in cities where hotel capacity was stretched thin.
4. Digital Platform Expansion
Platforms like Airbnb, Booking.com, and others have made it easier than ever for individuals to list their properties, leading to an increase in both supply and demand.
Urban Impact & Housing Market Pressures
While the economic benefits of short-term rentals are clear, they have created significant pressures on housing markets, particularly in major cities and tourist hotspots.
Housing Scarcity in Italy
Cities like Rome, Milan, and Florence have seen the impact of short-term rentals on long-term housing availability. As more homes are converted into short-term rental properties, the supply of available housing for locals diminishes, driving up rent prices and reducing availability.
Rental Price Inflation
Studies have shown that areas with high concentrations of short-term rentals often experience increased rents and property prices. This trend is particularly evident in central urban areas where short-term rentals provide higher yields than long-term rentals.
Policy Responses Across Europe
Governments and cities across Europe are grappling with the rise of short-term rentals. In response, many have introduced regulatory measures:
- Italy is exploring reforms to limit the growth of short-term rentals in high-demand areas to protect long-term housing availability.
- Other cities such as Barcelona, Venice, and Amsterdam have implemented licensing systems, caps on the number of short-term rentals, and other measures to balance tourism growth with the need for affordable housing.
Economic Benefits: A Double-Edged Sword
Despite concerns, the economic impact of short-term rentals remains significant. Italy, for example, generated nearly €20 billion in economic activity in 2024 through short-term rentals. This includes jobs in hospitality, transportation, and local businesses, and every euro spent on short-term stays is estimated to create multiplier effects in the wider economy.
The rise of short-term rentals — particularly Italy’s record-breaking growth — signals a broader transformation in the way people live, work, and travel. Short-term rentals are now a central part of the European housing and tourism landscape. Moving forward, Europe will likely see further regulatory changes and innovations to balance the economic benefits of short-term rentals with the growing need for stable, affordable housing.
Italy overtook France, Denmark, Ireland, Finland, Sweden, Portugal, and more European countries in short-term rental growth through Airbnb, driven by a surge in both tourism and the growing demand for flexible, transitional housing solutions. This shift has made Italy a leader in the evolving European accommodation market.
Italy’s leadership in short-term rental growth in 2025, surpassing France, Denmark, Ireland, Finland, Sweden, and Portugal, reflects a broader trend of flexibility, mobility, and accommodation that is likely to continue shaping Europe’s housing and tourism landscape for years to come.
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