For decades, its mesmerising blend of baroque and gothic beauty was closed to mass tourism by the iron curtain that divided the communist east from the capitalist west during the cold war.

Now Prague, which has gained an unenviable reputation as a destination for stag nights and pub crawls, has become the latest European city to propose a radical assault on Airbnb and other short-term letting platforms as over-tourism threatens to overwhelm it and drive out residents.

Under plans pushed by the city’s liberal mayor, Zdeněk Hřib, property owners would be barred from leasing out entire flats except when it was their own home and they were temporarily vacating it. Tourists demanding Airbnb rentals would be limited instead to single rooms in accommodation where the owner also lived.

Speaking to the Observer in his office in Prague’s new city hall – near the heart of the tourist district – Hřib, a member of the Pirate party, said the idea was the focal point of a scheme to “give Prague back to the people of Prague” and mitigate the negative effects of tourism.

He said Airbnb’s growth had turned the city, once the capital of the Holy Roman Empire and later a jewel of the Habsburg monarchy, into a “distributed hotel” and that failure to regulate it was “eating the city from inside”.

“In the past, you could limit the amount of tourists in the city simply by approving a certain number of hotels of certain capacity during the process of building permits,” said Hřib. “Now in Prague there is no possibility for the city to limit the accommodation capacity for tourists. The numbers are really critical.”

Nearly 8 million tourists flocked to the city – total population, 1.3 million – in 2018, up from 2.6 million in 2000, numbers that are expected to keep rising and which Prague’s infrastructure and finances are ill-equipped to cope with.

The increase has accelerated as Airbnb has consolidated its presence, transforming previously sleepy residential districts into busy zones characterised by foreign visitors with tell-tale wheeled suitcases in residential blocks.

An impact report from the city’s institute of planning and development said the number of Airbnb outlets almost tripled from 5,537 in March 2016 to more than 13,000 in May 2018, representing a jump from 17,913 to 52,738 in the number of beds. Eighty per cent of available rentals are entire flats.

The result has been an increase in noise and disturbance to long-term residents and soaring property values and rents that have priced locals out of the housing market. An average Prague resident needs to pay 14 times the annual salary excluding tax, housing, eating and clothing costs to buy a flat in the city, the mayor said.

Meanwhile the council has faced a widening financial shortfall as the nominal local tax levied on owners, some of whom live outside the Czech Republic, often goes unpaid and fails to cover the costs of the growing strain on resources and services.

Zdeněk Hřib, Prague’s mayor, says Airbnb has priced locals out of the housing market. Photograph: CTK/Alamy

“This is far beyond the original idea of the shared economy where you are supposed to let a tourist stay in your home, you cook the breakfast and you tell them something about your nice city,” Hřib said. “This is just a distributed hotel, where you abuse the comfort of other citizens in the city, the local residents, and seek your own profit at their expense.”

The European court of justice recently ruled that platforms like Airbnb were “information society services” rather than estate agencies, making them harder to regulate.

Hřib plans to overcome this by persuading the Czech regional development ministry to back legislation allowing local authorities to issue their own laws and decrees on short-term holiday lets according to local conditions. Similar efforts have previously failed, but the mayor insists that the growing awareness of Prague’s problem has generated enough political support for a law to pass.

Airbnb is just a distributed hotel, where you abuse the comfort of other citizens and seek profit at their expense

“The best way would be to regulate Airbnb in a way that the original shared economy idea would be preserved,” he said. “That means renting a room in your home would still be possible. However, it would not be possible to rent a whole flat that is not inhabited, or at least to [lease] it through the whole year.”

Apolena Rychlíková, a film-maker and journalist who has campaigned against the unfettered growth of short-term lettings, welcomed the city council’s proposal, “after five years of ignoring the problem”. She added: “As a resident of the centre of Prague, I feel like a stranger in my city every day. And I’m not alone.”

Janek Rubeš, a creator of the Honest Guide, a YouTube channel documenting the effects of over-tourism in Prague, said Airbnb’s evolution had harmed the city’s neighbourhoods. “These Prague apartment blocks aren’t made for tourism. Tourists have different needs from locals,” he said.

“They need a 24-hour reception, where they can get into buildings when they need to. It doesn’t work like that on Airbnb. It was a great idea at first, but not the way it is now.”

Prague is not alone in its stand against Airbnb. Last month, the council joined 10 other cities - Amsterdam, Barcelona, Berlin, Bordeaux, Brussels, Krakow, Munich, Paris, Valencia and Vienna - in signing a letter calling on the European commission to update its laws. “These short-term rentals are primarily for tourists at the expense of locals and families who want to live and work in our cities,” the letter says.

Some of the cities have imposed their own limits on the platform and similar outlets. In January 2019, Amsterdam tightened its rules on rental of entire homes to fewer than 30 days, from 60 days.

In Palma, Mallorca, authorities went further, issuing a ban in 2018 against almost all short-term Airbnb-type rentals of flats on the island, after local residents had complained of a sharp rise in rents.