Kyoto

Kyoto's Overtourism Crackdown: What It Actually Means for Short-Term Rental Operators

There’s a quiet reshaping happening in Kyoto’s short-term rental market — and if you own or manage property there, it’s worth understanding before your next pricing review or investment decision.

Kyoto has been wrestling with overtourism longer than most Japanese cities. The narrow alleys of Gion, the bamboo groves of Arashiyama, the stone-paved lanes of Higashiyama — all of them have become so overwhelmed during peak hours that the city has been forced to act. And those actions are now rippling into the accommodation market in ways that aren’t always obvious from the surface-level headlines.

Tokyo vs Kyoto vs Osaka: Short-Term Rental ROI Compared (2026)

“So where should I buy?” It’s the question I get more than any other from people looking to invest in Japanese short-term rental property. And my honest answer is always the same: it depends on what you’re optimising for. Each of Japan’s three major hospitality markets — Tokyo, Kyoto, and Osaka — has a genuinely different risk/return profile. After running guesthouse operations across a few of these cities and spending too many late nights in spreadsheets, here’s how I actually think about it.