The Government intends to restrict short-term lets in towns with a population of more than 20,000.
An agreement was reached in principle following discussions between Government party leaders and Minister for Tourism Peter Burke on the issue last night.
Short-term letting refers to the letting of accommodation for up to 21 nights at a time.
Initially the restriction was set to cover towns with a population of 10,000 but a significant change to this proposal is now in the offing.
It is understood that Minister Burke emphasised that operators need clarity.
There are 20 towns in the country with populations in excess of 20,000, according to the 2022 Census. Drogheda, Co Louth, was the largest, with 44,135 people counted there four years ago.
Legislation which will require all short-term lets to be planning compliant will be discussed by an Oireachtas committee later in the week.
The Department of Housing is also set to come forward with a planning statement on this often fraught topic.
Sinn Féin Spokesperson on Housing Eoin Ó Broin described the change as a completely retrograde step, and said the Government was once again “shafting” renters.