Overview of the Investigation
Investigate Europeâs âUntaxedâ investigation, led by journalist Attila KĂĄlmĂĄn, examines how generous tax advantages for realâestate investors across EU member states have fueled a dramatic rise in housing prices. The report highlights the disparity between owners and renters, showing that taxâdriven investor demand is a core factor in the continentâs housing affordability crisis.
HouseâPrice Surge Across Europe
Between 2015 and 2021, nominal house prices in the EUâ27 rose by almost 40 percent, with many countries seeing prices double or more. Estoniaâs prices increased nearly 2.5âfold in a decade, while Hungary, Luxembourg, Latvia and Austria have at least doubled. In most nations, price growth outpaced inflation and wage increases, making home purchase increasingly unaffordable.
Modest Rent Growth Compared with Prices
Rents grew by only about 8 percentage points over the same period, roughly matching cumulative inflation. This slower rise reflects the inelastic nature of the rental market, yet the gap between rent and houseâprice growth suggests further rent increases are likely as housing costs continue to climb.
Years of Average Wages Needed for a Home
Data from the Hungarian National Bank shows the average wage required to buy a 75 m² apartment in capital cities varies widely. In Prague, Bratislava and Paris, more than 20 years of wages are needed; in Oslo and Rome about 10 years; in Dublin, Brussels and Nicosia under 10 years. In Budapest, the required time rose from 6.3 years (2012) for a secondâhand flat to 18 years for a new dwelling by the end of 2022.
Ownership vs. Renting Patterns
Former socialist countries have homeâownership rates around 90 percent, while western and northern nations show lower ownership and higher renting. Germanâspeaking countries and Denmark exhibit nearâequal rates of owning and renting, highlighting regional cultural and policy differences.
RentâBurden and Overâburdened Households
In 2021, 50 percent of market renters in the EUâ27 spent at least 40 percent of their income on housing, compared with 11.5 percent of owners. Greece recorded the worst situation, with 96.6 percent of renters overâburdened; the Netherlands exceeded 80 percent. Among income groups, a third of the lowest 20 percent of earners are overâburdened, versus only 0.6 percent of the richest 20 percent.
Rental Affordability in Capital Cities
Eurostat and SIRP data show that oneâbedroom rentals in many capitals exceed 40 percent of median wages, making them unaffordable for average earners. In Brussels and Nicosia, the ratio reaches 41 percent; in Athens, Lisbon, Bucharest and Zagreb, rent can surpass an entire annual salary. Even nonâcentral rentals remain costly, with Warsaw and Lisbon requiring 63 percent of average salaries, while Vienna stays below 25 percent.
Tax Policies as a Driver of the Crisis
The investigation links generous tax reliefs for property investors to inflated house prices, noting that tax benefits often lack clear economic purpose. Taxâjustice experts argue that these exemptions enable investors to treat housing primarily as a financial asset, exacerbating supplyâdemand imbalances and pushing up costs for households.
Implications for Sustainable Housing
The findings underscore that taxâinduced price inflation undermines efforts toward sustainable, inclusive housing. High purchase and rental costs limit access to adequate dwellings, potentially increasing commuting distances, energy consumption, and social inequalityâkey concerns for a panâEuropean audience focused on sustainability.
