The Implications of Booking.com's Acknowledgment that "Regulation of Private Lodgings is Necessary" — The "Residents or Tourists?" Issue Facing Japan's Tourist Cities

The giant platform that has supported the global travel market has started to say, "Regulation is necessary for vacation rentals."

On August 21, 2026, the German financial information site "Aktiencheck" reported that Glenn Fogel, CEO of Booking Holdings, which operates Booking.com, expressed support for certain regulations on vacation rentals and homestays.

Fogel's argument is not a simple "pro-regulation" stance.

There needs to be a fair balance between travelers, accommodation providers, residents who need housing, and the administrations running cities. Without any rules, chaos would ensue. On the other hand, introducing excessive regulations that lack effectiveness would only create inefficiency, he argues.

This statement holds significant importance for Japan as well.

This is because, while the vacation rental market is expanding in Japan against the backdrop of increasing foreign visitors, there is a growing call for stricter regulations in areas like Tokyo, Kyoto, and Osaka due to issues such as the influx of tourists into residential areas, garbage, noise, late-night comings and goings, and troubles with neighboring residents.

The problems that have already occurred in Europe may surface in the same form in Japan.

Vacation rentals have become a massive market even for global travel platforms

Many people might associate Booking.com with a hotel reservation site.

However, today's Booking is not just a service that deals with hotels. It considers "alternative accommodations" such as private homes, apartments, villas, and guesthouses—accommodations other than hotels—as an important growth area.

According to the article by Aktiencheck, the number of accommodation listings on Booking exceeds 32 million, with about 9.1 million being alternative accommodations as of the end of the second quarter of 2026.

This represents an increase of about 8% compared to the same period of the previous year.

The second quarter materials of Booking Holdings in 2026 also indicate that the supply of alternative accommodations continues to expand, showing that vacation rentals and apartment-type accommodations are no longer peripheral markets in the travel industry.

These accommodations often offer larger rooms than hotels and come equipped with kitchens and washing machines. They are highly convenient for family trips, group travel, and long stays, and they are well-suited for inbound travel.

From the traveler's perspective, having more accommodation options is generally a welcome development.

The issue lies in whose housing these rooms originally were.

An increase in tourist beds could mean a decrease in rooms for residents

The biggest issue surrounding vacation rentals in Europe has been competition with housing.

In tourist cities like Paris, Amsterdam, Venice, and Berlin, renting out homes to travelers on a short-term basis can sometimes yield higher profits than leasing them to regular residents on a long-term basis.

For example, a home that could be rented for 150,000 yen a month could generate 400,000 yen if used for 20 nights a month at 20,000 yen per night.

Of course, cleaning fees, platform fees, furniture, and utilities are required, so a simple comparison cannot be made. Nevertheless, in areas with extremely strong tourism demand, there is an economic incentive to convert properties for short-term stays.

If it's just one property, it's not a big issue.

However, if hundreds or thousands of homes in a given area simultaneously shift to the short-term stay market, the supply of long-term rental housing could decrease.

As a result,

it becomes difficult to find housing.

Rents rise.

Local residents move away from the city center.

The apartment next door frequently changes occupants to travelers.

If such phenomena accumulate, the very character of the city could change.

It's a paradox where the city becomes uninhabitable for the residents who built it, precisely because it is popular with tourists.

The "fair balance" Fogel refers to likely points to this very issue.

Vacation rentals are no longer a special presence in Japan

In Japan, the Private Lodging Business Act, known as the "Minpaku New Law," was enacted in 2018.

Under the Private Lodging Business Act, vacation rentals are generally limited to operating within 180 days per year.

Meanwhile, local governments can further restrict operating days and areas through ordinances based on regional circumstances.

According to the Japan Tourism Agency, as of July 15, 2026, the cumulative number of notifications for private lodging businesses reached 65,837.

Considering that there were 2,210 notifications as of June 15, 2018, at the start of the system, this is a significant increase.

Although this is a cumulative figure that includes facilities that have closed, it is undeniable that vacation rentals have grown into a massive lodging infrastructure in Japan in a short period.

In cities with many foreign tourists, such as Tokyo, Osaka, Kyoto, and Fukuoka, it is no longer uncommon to see apartments and houses used as accommodations for travelers.

And as the market grows, the boundary between the "tourism industry" and "residential life" becomes an issue.

Regulation strengthening is progressing at the municipal level in Tokyo

Tokyo is symbolic when considering the future direction in Japan.

In Tokyo's 23 wards, each municipality has a different stance on vacation rentals.

While the Private Lodging Business Act itself is common nationwide, municipalities can restrict operating days and areas through unique ordinances to protect the local living environment.

Taito Ward revised its vacation rental ordinance in 2026.

For new private lodging business notifications after October 1, 2026, a system will be introduced to restrict weekday operations, regardless of whether the owner lives on-site or not.

Taito Ward, which includes some of Japan's most famous tourist destinations like Asakusa and Ueno, is trying to balance tourism demand with local life.

Meanwhile, the increase in vacation rentals continues in Shinjuku Ward.

According to materials published by Shinjuku Ward, the number of private lodging business facilities increased from 1,366 in fiscal year 2021 to 3,749 in fiscal year 2025.

That's about 2.7 times in just a few years.

This figure means that while vacation rentals have become an undeniable presence in the lodging market, the administration must also allocate many resources for monitoring and guidance.

Opinions on SNS call for "more regulation"

Discussions about vacation rentals are active on Japanese social media as well.

On platform X, there are criticisms about the increase of vacation rentals and simple lodgings in residential areas, with sentiments like "business operators profit, but only the surrounding residents bear the burden."

There are also opinions that while transparency and regulation of vacation rentals are being strengthened overseas, Japan's regulations are still insufficient.

Particularly from the residents' side, noise, garbage disposal, smoking on the street, late-night comings and goings, and attempts to enter neighboring homes by mistake are often highlighted as issues.

In the case of hotels, there are often front desks or management staff on-site who can immediately address issues.

However, in unmanned vacation rentals, the operating business may be located away from the site.

For guests, it's just "a place to stay for a few days," but for neighboring residents, it's a residential area where they live 365 days a year.

This difference in perception is at the root of the troubles.

Therefore, on social media, there is a certain number of people who believe that while not calling for a complete ban on vacation rentals, stricter measures should be in place for resident managers, emergency contact systems, identity verification, waste disposal, and noise control.

On the other hand, there are voices saying "It's not that vacation rentals themselves are bad"

However, the reaction on social media is not solely in favor of stricter regulations.

From the perspective of vacation rental operators, there are also claims that "the issue is not the vacation rental system itself, but operators with low operational quality."

Setting appropriate accommodation rules and providing clear guidance in multiple languages.

Explaining how to dispose of garbage.

Prohibiting noise at night.

Having a manager who can respond immediately in emergencies.

Communicating with neighboring residents in advance.

The belief is that many troubles can be prevented by thoroughly managing these aspects.

This point is very important.

The fact that "problems occurred with vacation rentals" and the conclusion that "vacation rentals themselves are problematic" are not the same.

Noise issues can occur in hotels, and garbage and neighbor troubles can happen in rental housing.

The debate remains on whether problematic operators and those who operate appropriately should be treated under the same regulations.

The background to Fogel's warning about excessive regulation being "only inefficient" likely includes these circumstances.

The danger of considering "Tokyo" and "regional areas" under the same rules

When considering Japan's vacation rental policy, regional differences must be particularly noted.

For example, the circumstances in Tokyo's Shinjuku and those in regional cities experiencing population decline are entirely different.

In central Tokyo, housing shortages and rent increases can become issues.

Meanwhile, there are many vacant houses in regional areas where no one lives.

Converting vacant houses into vacation rentals in such areas could lead to maintenance and management of abandoned houses rather than putting pressure on housing supply.

In regions with few lodging facilities, vacation rentals may be essential for accommodating tourists.

When travelers stay, consumption occurs in restaurants, supermarkets, transportation services, and tourist facilities.

Foreign travelers staying in small towns without hotels and using local restaurants.

This holds significant value from the perspective of regional revitalization.

Therefore,

"Regulate all vacation rentals"

or,

"Completely liberalize all vacation rentals"

is not a realistic approach.

What Japan needs is "regulations that vary by location"

In the future, Japan should not aim for a complete ban or complete liberalization of vacation rentals.

What is important is a system that changes regulations according to housing supply and demand and the number of tourists.

For example, in areas with severe housing shortages, strictly regulate vacation rentals that offer entire homes to travelers year-round.

On the other hand, be relatively flexible with home-sharing types where the owner lives while renting out spare rooms to travelers.

In areas with high vacancy rates and a lack of lodging facilities, promote conversion to vacation rentals.

Even under the same name "vacation rental," the impact on society can vary greatly.

Policies do not need to be singular.

The era of holding OTAs accountable

Another important aspect is the responsibility of online travel agencies (OTAs) like Booking.com and Airbnb.

In the past, discussions about vacation rental issues often centered on the responsibilities of operators and administrations.

However, in reality, OTAs hold much of the entry point for travelers to find vacation rentals.

If illegal facilities or those that have received administrative penalties continue to be listed on the platform, it is difficult for users to distinguish them from legal facilities.

Conversely, if administrations and OTAs share data and can automatically verify registration numbers and operating days, illegal operations could be significantly reduced.

In Japan, housing accommodation intermediaries are legally required to bear certain responsibilities.

In the future,

automatic verification of registration numbers,

management of permissible operating days,

suspension of listings for facilities that have received administrative penalties,

tracking the number of complaints,

transparency of operator information,

and similar systems may be required.

This is not necessarily a negative for operators.

If illegal vacation rentals decrease, it would improve the situation where operators who comply with the law are unfairly disadvantaged in price competition.

The real issue surrounding vacation rentals is not "tourists or residents"

In discussions about vacation rental regulations, a dichotomy is often created between "prioritizing tourists or residents."

However, this binary choice is not appropriate.

A city that becomes difficult for residents to live in will lose its appeal as a tourist destination in the long run.

If local shops disappear and all housing becomes lodging facilities, the city will become like a giant hotel.##HTML_TAG