This in-depth analysis provides an overview of the reactions of Member States to the Cali Apartments SCI case and analyses challenges and opportunities stemming from short-term rental (STR) regulation. It also reflects on possible EU policy options in the STR field. Building on the briefing by Colomb (2025) on the Regulatory aspects of short-term rentals in the EU, this in-depth analysis examines in more detail the landmark ruling (C-724/18 and C-727/18) in the Cali Apartments SCI case. The ruling by the CJEU recognised the objective of combatting the rental housing shortage as an 'overriding reason relating to the public interest' that can justify proportionate measures on STR accommodations.