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With the new year fast approaching, it’s the perfect moment to take a step back and review how the vacation rental industry has evolved over the past year.

So, rather than focusing solely on December’s headlines, this month’s lowdown highlights key developments from all of 2025—and what they could signal for the year ahead.

Summary:

Governments around the world introduced a mix of licensing updates, registration systems, caps, taxes, and more aimed at alleviating the affordable housing shortage.
The most famous example of this comes from Maui County, which signed Bill 9 into law to return 7,000 apartment-zoned vacation rentals to the long-term housing market.
Airbnb introduced Airbnb Services; Reserve Now, Pay Later; a single-fee structure; social upgrades for Experiences; and more.
Industry-wide AI tools expanded trip planning, booking, and pricing automation, with major contributions from OpenAI, Google, Expedia, Booking.com, and HomeToGo, making AI a core part of the guest experience.

Vacation rental legislation around the world

When reflecting on vacation rental industry developments in 2025, one theme dominates: regulation.

As housing affordability remains a pressing challenge in destinations worldwide, governments have introduced a variety of rules and restrictions. Many of these measures are based on the belief that short-term rentals reduce housing availability and drive up property values and rents—a point the industry continues to contest.

Let’s explore how different governments are responding to these challenges.

Maui County signs historic bill into law

As our U.S. readers will know, vacation rental legislation varies widely across the United States, with some markets enforcing stringent regulations and others embracing a laissez-faire attitude.

This year, the biggest U.S. news has come out of Maui, which has been deciding which path to take following Hawaii’s 2024 decision to let individual counties set their own vacation rental rules. Senate Bill (SB) 2919 (passed in May of 2024) gave counties the right to designate vacation rentals as nonresidential use for zoning purposes as well as tax, regulate, and even ban them altogether.

Maui County Mayor Richard Bissen was quick to make use of this right, announcing almost immediately a proposal to phase out 7,000 vacation rentals in the apartment district. Now, after much deliberation, this proposal has finally been approved with the signing into law of Bill 9 on December 16, 2025.

Bill 9 closes a long-standing zoning loophole that allowed “Minatoya” vacation rentals to operate in apartment-zoned areas originally intended for long-term housing. The aim is to move thousands of units back into the long-term rental market and ease Maui County’s housing shortage, which worsened after the 2023 wildfires.

Key deadlines

With the passing of Bill 9, short-term rentals in apartment districts must stop operating by:

January 1, 2029 in West Maui
January 1, 2031 in the rest of Maui County

These phased timelines are designed to give owners time to transition their properties to long-term use or explore other options.

What’s affected—and what isn’t

More than 6,000 apartment-zoned vacation rentals are expected to be phased out.
Around 6,500 existing transient vacation rental (TVR) parcels—plus hotels, timeshares, and B&Bs—remain unaffected.
Apartment zoning will continue to allow long-term residential use without rezoning.

Hotel rezoning pathway

Owners who want to continue operating short-term rentals may pursue rezoning. A County Temporary Investigative Group has recommended creating new H-3 and H-4 Hotel districts, which could allow about 4,500 units to continue operating, pending County Council approval. The Council plans to explore rezoning further in a meeting on December 19, so keep an eye open for additional updates.

Takeaways

County leaders have framed Bill 9 as a housing-first measure, not an anti-tourism move. The goal is to restore apartment-zoned housing to local residents—at a time when short-term rentals make up roughly 21% of Maui County’s housing stock—while shifting visitor demand toward hotels and other regulated accommodation.

Only time will tell what impact this decision will have. For now, Maui-based hosts’ best move is to stay up-to-date on changes in deadlines and rezoning options.

The United States

In other U.S. legislation news:

Mayors in northern Arizona pushed for greater local control over short-term rental rules to address housing shortages and community impacts.
Austin City Council approved updated regulations that revise licensing, platform obligations, spacing and capacity rules, and tenant eligibility, setting phased enforcement dates for 2025–2026 while rejecting geographic density caps.
Clark County (home to Las Vegas) was hit with multiple lawsuits challenging its strict short-term rental rules, including one presented by Airbnb and the Greater Las Vegas Short-Term Rental Association (GLVSTRA).
Dallas’ 2023 short-term rental ban is headed to the Texas Supreme Court after legal challenges, as the city seeks enforcement authority ahead of the 2026 FIFA World Cup.
Hawaii introduced the nation’s first “Green Fee” on tourist accommodations, raising taxes on hotels, short-term rentals, and other lodgings to fund climate resilience and environmental protection starting in 2026.
A federal court dismissed Airbnb’s lawsuit against New Orleans’ 2023 short-term rental laws, affirming the City Council’s authority to regulate STRs and enforce permitting and platform verification.
A short-term rental owner sued the city of St. Louis, claiming its 2024 STR regulations were unconstitutional and leading to a pause in the new ordinance. Although a judge has since ruled that most of the rules can be enforced, the city still hasn’t implemented them, leaving oversight on hold and causing much confusion and frustration.
A bill in Vermont (House Bill 242) proposed sharply limiting short-term rentals by requiring on-site hosting, capping rentals per property, and introducing a statewide registration system.

Overall, 2025 has highlighted the ongoing legal uncertainty around short-term rentals in the U.S., as multiple lawsuits demonstrate that courts are still grappling with how far cities and states can go in regulating the industry.

Canada

Meanwhile, Canada saw the following updates to its short-term rental regulations and taxes:

Beginning in January 2025, the Canada Revenue Agency tightened deductions for short‑term rental expenses, denying full deductions for noncompliant rental activity.
An update to the short-term rental bylaw in Calgary went into effect on April 1, requiring all rentals of up to 180 days to have a business licence, distinguishing between primary and nonprimary residences with different fees, removing condo board consent, and excluding affordable housing from STRs.
A new short-term rental registry came into effect in British Columbia on May 1, requiring all short-term rental properties to be registered with the province and to display a valid registration number or risk being delisted.
A new bylaw in Montreal restricted short-term rental operations to June 10–September 1. Even during this period, only primary residences can be listed, and violators will face fines of up to $2,000.

The United Kingdom and Ireland

The biggest short-term rental news out of the UK this year is also the most recent: The government is currently considering granting England’s regional mayors the power to levy charges on overnight stays, including short-term rentals, in a move that would bring English cities in line with destinations like New York, Paris, and Milan. The proposal—which is under consultation until February 18, 2026—would apply to all guests, including domestic travelers, and each mayor would decide whether to implement it in their area.

In other news from the UK and Ireland:

Edinburgh City Council voted to temporarily ease short-term rental regulations and health and safety requirements for primary residences during its festival period to meet high demand, despite concerns about potential safety and quality risks.
Dublin City Council banned lockboxes on public structures for short-term rentals—requiring hosts to adopt alternative check-in methods by April 14, 2025—to address safety and visual clutter concerns.
In Ireland, the Short-Term Letting and Tourism Bill was approved in April, establishing a national short-term letting register managed by Fáilte Ireland set to go into effect in May of 2026.
The Irish Self-Catering Federation (ISCF) has been urging the government to hit pause and consult with operators before rolling out this STR register.

Note that, while a new short-term rental registration scheme was expected in the UK this year, nothing has been rolled out as of yet. A new release date seems to be expected for April 2026, so keep your eyes open for news.

Australia

Governments down under implemented some new legislation of their own, including the following:

Victoria’s Short-Stay Levy went into effect on January 1, charging a 7.5% levy on short-stay accommodation bookings to support housing and local services.
Brisbane City Council has proposed new rules requiring development approval and annual permits in certain residential zones, with additional compliance measures and fines for violations. If approved, the new rules would go into effect July 1, 2026 and are expected to return nearly 500 homes to the long-term market.
The City of Sydney is exploring reducing the cap on unhosted short-term rentals from 180 to 60 days per year to help address housing shortages.
In New South Wales, owners of non-hosted STR units in strata buildings must now secure owners’ corporation approval before listing as of July 1.

Europe

Finally, let’s take a look at the state of short-term rental regulations in some of the most popular destinations in Europe:

In 2025, major cities in France tightened controls with mandatory registration numbers, limits on second homes, higher penalties for nondeclaration, a reduced micro-BIC tax allowance for tourist rentals, and new second-home surcharges. Since the Le Meur law passed, policymakers have clearly continued to move toward stricter regulation.
German cities continued to impose strict rules, notably Berlin and Munich. Limits on second homes and the requirement for permits to rent out entire properties are being tightened. Platforms must now more systematically verify registration numbers.
Italy has introduced a mandatory national identification code (CIN) for all tourist accommodations, while cities like Rome and Florence are tightening local rules, especially in historic centers. Some municipalities have banned key boxes and automated check-ins, though a national requirement for in-person check-in was later overturned by an administrative court.
In Portugal, all short-term rentals (alojamento local) must be registered and locally authorized, meeting strict administrative, safety, and habitability requirements. Lisbon and Porto designated certain neighborhoods as containment zones where no new licenses will be issued, while municipalities gained broader powers to restrict or revoke licenses to reduce tourist pressure and protect housing supply.
Spain has introduced the Registro Único, a national registry requiring all hosts to register their accommodation, even if they already hold a regional license. At the same time, regions such as the Balearic and Canary Islands are enforcing stricter limits, while Madrid, Catalonia, and Andalusia have removed tens of thousands of noncompliant listings. Barcelona remains committed to its plan to phase out all short-term rental licenses by November of 2028.
Amsterdam remains one of the most restrictive cities in Europe: annual quotas, mandatory registration, and frequent checks. Rotterdam is following the same path with even more restrictions on short-term rentals in certain neighborhoods.

Airbnb in 2025

Airbnb was busy this year, releasing numerous updates for guests and hosts alike. Here are the most important changes to be aware of.

Airbnb Services

As part of its 2025 Summer Release, Airbnb introduced Airbnb Services, which lets guests book add-ons like private chefs, spa treatments, and fitness sessions—even if they’re not staying in an Airbnb. The goal is to give travelers the convenience of hotel-like services while still enjoying the unique space Airbnb is known for.

Keep in mind that Airbnb Services are only available in select cities for now, and that they won’t actually generate any extra income for hosts. However, guests are allowed to book services at your property by default, so be sure to contact Airbnb support if you’d like to opt out.

Reserve Now, Pay Later

This summer, Airbnb introduced “Reserve Now, Pay Later,” allowing U.S. guests to book eligible stays with $0 upfront and pay before the end of the listing’s free cancellation period.

Targeted at properties with flexible or moderate cancellation policies, the feature is designed to encourage earlier bookings and appeal to budget-conscious travelers. After its U.S. launch, Airbnb plans to roll out this option globally in early 2026.

Single-fee structure

If you host on Airbnb, you may know that the platform has historically offered two types of booking fee structures: the split fee (hosts pay 3%, and guests pay 14.1-16.5%) and the single fee (hosts pay the full amount, usually 14-16%).

Well, that changed this year, with the platform moving most hosts to a single-fee structure and replacing the old split-fee model. A new standard rate of 15.5% took effect for most hosts on October 27.

The goal of this change? To simplify pricing, as the price you set is now the exact amount guests see and pay. If you haven’t already, be sure to review and adjust your nightly rates in Lodgify to maintain consistent payouts and protect your profits.

Additional updates

Some of Airbnb’s other top updates this year included:

A switch to total price display—including all fees before taxes—as the default setting on listings worldwide, both to improve transparency and to align with the new U.S. Federal Trade Commission rules against hidden fees
Changes to the Off-Platform and Fee Transparency Policy, banning off-platform payments and third-party guest registrations
Updated payment terms, including adjusted payout timing for new hosts, clarified payment methods and schedules, and payout entity changes for Canadian hosts
Updates to cancellation policies, including a new 24-hour cancellation window, a new “Limited” policy, and retiring the long-standing “Strict” policy in favor of the default “Firm” option
Temporary phone numbers for U.S. hosts and guests, enabling secure calls and SMS from booking to two days after checkout without sharing personal contact information
Social upgrades to Experiences (including the Who’s Going feature, direct messaging, and a Connections tab), helping guests connect before, during, and after trips
The testing of hotel listings in markets where short-term rental rules have sharply reduced home supply, including New York City, Los Angeles, and Madrid

AI: the new norm for trip planning?

If we had to choose one theme for the innovations that the travel industry has seen in the past year, it would undoubtedly be artificial intelligence (AI). And while that’s not necessarily a novelty in itself (AI has been a major topic for several years now), the trends have skewed primarily toward trip planning this year.

Here are some of the biggest AI-related updates in the industry from the past 12 months:

OpenAI launched Operator, a browser-based AI agent for ChatGPT Pro users in the U.S. that can autonomously complete online tasks like bookings and form-filling.
HomeToGo and Kayak rolled out AI-powered, conversational search tools to make it easier for travelers to find listings and deals that match their preferences.
Expedia launched a new AI-powered Trip Matching tool that turns Instagram content into bookable travel itineraries.
Beyond introduced Neyoba, an AI-powered pricing assistant that helps you quickly analyze performance, optimize rates, and make smarter revenue decisions through conversational insights.
ChatGPT integrated with both Expedia and Booking.com, allowing travelers to research and book trips directly within the chatbot.
Booking.com also released new AI tools that help automate and personalize guest communication, streamline the booking process, and improve satisfaction.
Google is rolling out agentic AI tools that allow travelers to plan and book trips conversationally, using dynamic itineraries, real-time search data, and personalized preferences.
Airbnb is testing out a conversational “What” search box that lets guests type what they want in plain English—no filters required.
Stripe, OpenAI, and Google have begun developing agentic commerce solutions that let AI agents handle transactions securely, paving the way for fully autonomous bookings.

The main takeaway: AI is no longer just a back-end tool—it’s becoming a central part of how travelers plan, book, and experience trips, making it essential for hosts and property managers to understand and adapt to this rapidly evolving landscape.

See you next year!

2025 has been another eventful year for the vacation rental industry: From navigating new legislation around the world to adapting to AI-powered tools and Airbnb updates, hosts and property managers have certainly had their hands full.

The upside? Technology continues to make managing your vacation rental business easier and more efficient than ever—a trend that’s only set to grow in 2026.

If you haven’t tried Lodgify yet, now’s the perfect time to see how it can simplify operations and boost your bookings. Start with a free seven-day trial or schedule a demo with one of our experts today!

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The post Lodgify Lowdown: 2025 in Review for the Vacation Rental Industry appeared first on Vacation Rental Owners & Property Managers Blog – Lodgify.

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Lodgify Lowdown: 2025 in Review for the Vacation Rental Industry