Airbnb is to restrict to 90 days the amount of time properties listed in London can be hired out.
New and automated limits are being introduced to help ensure entire home listings in the capital are not shared for more than 90 days, unless hosts confirm they have the required permission to share their space more frequently.
This comes after Airbnb started to work with cities that have identified a shortage of long-term rental housing as a critical issue.
The new initiative in London “will make it easier for hosts in London to act in the best interests of everyone in the city”.
Airbnb introduced a Community Compact project last year which includes a commitment to remove “unwelcome commercial operators”.
A company spokesman said: “London is a world leader for the sharing economy, has long supported the right of regular people to share their homes and has introduced clear home sharing rules.
“We know the vast majority of Airbnb hosts in London are regular people who share their homes to help them afford one of the most expensive cities in the world.
“The typical Airbnb host in London earns £3,500 by sharing their space for 50 nights a year and the Airbnb community generated an economic impact of more than £1.3 billion in London last year.
“We firmly believe this step will help build a better London for everyone and work is already underway to implement these measures, which will be in place by spring 2017.
“We want to be good partners to London and continue to lead our industry on this matter, and ensure home sharing grows responsibly and sustainably.”
British Hospitality Association chief executive Ufi Ibrahim welcomed the move towards more structured and responsible home sharing.
She said: “We have been calling on the government to enforce regulatory controls on home-sharing platforms and while this move by Airbnb is welcome it is important that all home sharing platforms are similarly regulated.”