The constant increase in house prices and rents has worsened the housing crisis in the EU in the last decade, although it affects the Member States differently. Despite being a national competence, the dimension of the housing crisis is raising alarms in Brussels and taking the debate to the heart of community institutions.
Eurostat data confirm the scale of the crisis. House prices increased by an average of 47% in the European Union (EU), between 2010 and 2022. The rise in prices affected twenty-four Member States. There was also a practically constant increase in rents: 18% during the same period. Rents grew in all countries except Greece. In 2022, on average, a European household allocated around 20% of its income to housing.
Social housing can be one of the ways to solve the problem. But social, public or cooperative housing in the EU only represents around 11% of the total, according to Housing Europe – the sector’s European Federation. In northern European countries, this sector is strong: Netherlands (29%), Denmark (21%), Sweden (17%). In southern countries it is very low: Portugal (2%), Spain (1.1%), Italy (3.8%).
What can the EU do?
As a matter of national competence, the EU can help Member States through initiatives and financial instruments, through cohesion policy (ERDF or ESF+) or InvestEU, for affordable and social housing projects and help for the homeless. .
Member States have also invested in RRP funds for the energy renovation of buildings and the construction of social housing. For all Member States, the recovery and resilience mechanism foresees reforms and investments in social and affordable housing of around 15 billion euros. Portugal and Spain are those that have planned the most investment in the PRR for the construction of affordable housing.
Priority for MEPs
The structural and European dimension of the housing crisis is leading to greater EU engagement. It has already sparked several debates among the 27 and in the European Parliament, despite not being an EU responsibility.
Recently, the president of the European Economic and Social Committee urged the EIB to create a special fund to invest in affordable housing. The main political groups are including the issue as a priority in their manifestos for the European elections.
The PPE assumes “the transversal dimension of housing policy, framing it within a logic of intergenerational solidarity and focusing on the need to support young people in starting a family”, says Lídia Pereira. The PSD MEP defends an “efficient and transparent execution of European funds”, the Renovation Wave program for recovering houses, support for exploratory projects and new housing solutions, and taking advantage of the potential of the internal market by facilitating cross-border investment.
European Socialists propose a European Plan for Affordable Housing with corresponding investments. PS MEP, Pedro Marques, argues that existing resources must be “parts of a European strategy with “head, trunk and limbs”, coherent and inserted into a broad political decision on public investment”. “In the case of housing, more than discussing amounts, we need binding objectives that are reflected in economic and social policies”.
Tags: Housing crisis raised alarm bells Brussels Europa Viva
