A coordinated EU approach to housing

This briefing, titled "A coordinated EU approach to housing," is published by the European Parliamentary Research Service (EPRS) and authored by Marketa Pape. It is designed for Members of the European Parliament, providing essential background information regarding the increasing housing crisis across the European Union, especially as it has been intensified by the recent cost-of-living crisis. The document outlines the EU's current and potential roles in addressing this escalating issue.

The briefing highlights a significant problem with housing affordability throughout the EU, exacerbated by rising construction costs, higher mortgage rates, and a slowdown in housing construction. Average house prices have surged by 48% and rents by 22% between 2010 and 2023. Notably, homelessness has escalated by an estimated 70% over the past decade. The construction sector is also facing contraction and significant labor shortages, affecting not just low-income groups but also middle-income citizens and key workers who struggle to afford market-level housing.

The document emphasizes the environmental impact of the housing sector, noting that buildings account for 40% of the EU's energy consumption and 36% of its CO2 emissions. Renovating the housing stock is crucial for achieving the EU's climate goals and mitigating energy poverty, making it essential to decarbonize the existing housing infrastructure.

While housing primarily falls under the responsibility of Member States, the EU indirectly influences housing through legislation and policy guidance. The revised Energy Performance of Buildings Directive mandates that all new buildings be zero-emission by 2030 and sets targets for reducing energy use in residential buildings. Current EU competition rules regulate how Member States can subsidize social housing, but many stakeholders argue that the definition of the target group for social housing is too narrow, hindering broader access to affordable housing.

The EPRS briefing identifies multiple EU funding instruments available to support housing, with an estimated €100 billion allocated for energy efficiency renovations until 2030. Key sources include the Recovery and Resilience Facility, the European Regional Development Fund, and the new Social Climate Fund set to launch in 2026. Significant financing is also being provided by the European Investment Bank for social and affordable housing initiatives.

In response to the ongoing housing crisis, the European Parliament established a Special Committee on the Housing Crisis to analyze the problem and propose actionable solutions. The European Commission is preparing a "European affordable housing plan" and has initiated a call for evidence to gather input from stakeholders. Additionally, there is political momentum pushing for a "European new deal for affordable and social housing," advocating for revisions in rules that may aggravate the housing crisis and increasing investment in socially inclusive and sustainable housing.