Who can still afford to live here?
If you feel like buying a house is completely out of your reach, you're not alone. Since 2015, housing prices across the EU have increased by 48%, while rents rose 18% between 2010 and 2022.
It's a Europe-wide problem – but are there European solutions? In response to mounting pressure, the European Parliament has launched a dedicated housing committee to develop policy solutions. Meanwhile, Dan Jørgensen has been appointed as the EU's first housing commissioner.
His mandate includes rolling out a so-called European Affordable Housing Plan, which aims to increase the supply of affordable homes across member states. He also plans to establish the Pan-European Investment Platform, a collaboration with the European Investment Bank to attract both public and private investment in sustainable housing projects.
Another proposal, the Affordable Housing Initiative, will pilot 100 renovation projects to create models for sustainable and affordable housing.
Despite these efforts, the EU's ability to tackle the crisis is limited. Housing policy still falls mostly under national governments' competence, and the EU can only encourage investment and voluntary cooperation rather than enforce solutions. This means progress will depend on how much individual member states engage with these initiatives.
A few countries are taking action at a national level. In Portugal, a €2.2 billion housing initiative is underway to build 33,000 affordable homes by 2030, with a focus on helping low-income families. Spain, on the other hand, now limits property purchases by non-EU residents to curb speculative investments that inflate housing prices. These national efforts teach us valuable lessons, but they also highlight the fragmented nature of Europe's approach to housing.
So, what else could the EU do? While it can't take full control of housing policy, it could revise state aid rules to allow more direct public investment in affordable housing, set minimum standards for affordability across the bloc, or push for stronger sustainability requirements in new housing developments.
Rent control policies, including caps on rent increases, have been discussed across various European countries. Some member states like France and Germany have independently implemented rent control policies. France implemented the ELAN law in 2018, establishing rent controls in designated ”tense” areas where housing demand exceeds supply. German cities like Berlin enforce rent control policies, aiming to cap rent increases and maintain affordability.
The EU's latest strategy is a step in the right direction, but without enforcement mechanisms, it's unlikely to bring lasting change. National initiatives provide useful examples, but without a more coordinated and enforceable EU-wide approach, housing will only become more unaffordable – and public discontent will continue to grow.