Europe cannot simply build its way out of the housing crisis

The article titled "Europe cannot simply build its way out of the housing crisis" is authored by Erkki Perälä and Liisa Perjo, and published by Demos Helsinki, a think tank focused on promoting innovative solutions for societal challenges. The piece addresses the impending housing crisis in Europe, emphasizing that traditional methods of merely constructing more housing units will not effectively resolve the issue. It raises critical questions about how cities can ensure housing justice while also preventing further ecological and biodiversity crises.

The current housing landscape in Europe is dire, with house prices soaring by 47% and rents by 18% between 2010 and 2022. In extreme cases, like Estonia, house prices skyrocketed by 192%, while rents surged by 210%. These alarming statistics highlight housing affordability as a pressing issue in many European cities. The growing political pressure on the European Commission is evident, with mayors from major cities urging action to tackle the crisis. The establishment of a dedicated housing commissioner and a Special Committee on the Housing Crisis in the European Parliament underscores the urgency of the situation.

The authors point out that the longstanding reliance on increased housing construction has led to a compounded crisis encompassing financialization, social inequalities, and environmental degradation. While the demand for affordable housing intensifies, the existing policies often ignore the interconnectedness of housing issues with climate change and biodiversity loss. Current approaches do not adequately address these vital aspects, rendering them ineffective in developing sustainable housing solutions.

New construction is not without significant environmental consequences, with the built environment contributing up to 40% of global greenhouse gas emissions. This includes both operational carbon, associated with heating and energy use, and embodied carbon from the production and transportation of building materials. Notably, the UK’s target to build 300,000 new apartments annually could consume its entire carbon budget by 2050. As a result, the push for new developments risks exacerbating ecological crises rather than alleviating housing shortages.

To address the housing crisis sustainably, city leaders are encouraged to explore innovative policies that shift the focus from continuous expansion to better utilization of existing housing stock. Strategies include incentives for downsizing, regulations on short-term rentals, higher property taxes on vacant properties, co-housing models, and subdividing large apartments into smaller units. These measures aim to improve housing availability while simultaneously addressing environmental concerns.

The article concludes that a transition to sustainable urban housing requires new policy frameworks, alternative funding models, and collaborative innovations. It stresses that social equity and ecological responsibility should not be seen as conflicting priorities but rather as integral components of future housing strategies. The authors advocate for a systemic transformation in how cities approach housing, emphasizing that the future of affordable living must be rooted in sustainable practices that respect planetary boundaries.