How can Homeownership Be a Progressive Policy? Rethinking Affordability, Finance, and the Politics of Housing

Overview of the Research Brief

This brief, authored by Aidan Regan and published by the Progressive Politics Research Network, analyses how homeownership can be framed as a progressive policy in advanced economies. It draws on recent data from OECD, Eurostat, and national surveys to illustrate the growing affordability crisis and its political implications across Europe.

Housing Affordability Crisis in Europe

Across OECD countries, housing consumes 20‑30 % of disposable income, with owners and renters alike facing rising costs. Between 2010 and 2023, average EU house prices rose by nearly 50 % while rents increased around 22 %. Ireland experienced the steepest price surge (≈ 70 %), whereas Italy and Greece saw declines. Homeownership rates remain high (≈ 70‑75 % of households), but ownership is increasingly concentrated among higher‑income groups; the top income quintile owns 85‑90 % of homes, while the bottom quintile lags far behind.

Key Data on Ownership and Income Gaps

• Ownership by income quintile (2022): top quintile 85‑90 %; bottom quintile markedly lower, especially in the US and France.
• Mortgage‑free ownership exceeds 50 % in many EU nations, highlighting the role of asset inflation.
• House‑price growth has consistently outpaced wage growth since 2000, widening the affordability gap.

Mortgage Finance Regimes and Their Impact

Four historic mortgage finance models shape national outcomes:

1. Direct finance (self‑build)
2. Deposit‑based finance (building societies, e.g., UK, US)
3. Bond‑based finance (mortgage banks issuing covered bonds, e.g., Germany, Denmark)
4. State finance (public subsidies and direct funding) Bond‑based and state‑led systems tend to sustain stronger rental sectors and more stable price‑to‑income ratios, whereas deposit‑based regimes are linked to higher price volatility and speculative cycles.

Public and Non‑Profit Housing as an Anchor

Non‑profit and public housing accounts for only 7‑8 % of European housing stock, yet where it is substantial, affordability improves markedly. Vienna’s municipally owned or cooperative housing covers about 40 % of residents, keeping rents low. Singapore’s public‑owner‑occupied flats house over 80 % of its population. Paris aims to raise public‑backed housing to 40 % by 2035 through pre‑emptive rights and quota requirements.

Policy Recommendations for Sustainable Homeownership

1. Expand non‑profit/public housing – increase state capacity to build and manage homes at scale.
2. Reform mortgage finance – adopt covered‑bond models, shared‑equity schemes, and public‑backed lenders to lower borrowing costs without fueling speculation.
3. Bridge renter‑owner divide – implement tenant‑protection tools (e.g., Germany’s Mietspiegel) and pathways such as lease‑to‑own, starter loans, and shared‑ownership programs.
4. Reframe housing as public good – treat housing as essential infrastructure, enabling long‑term borrowing and land‑value capture to fund affordable construction.

Political Stakes for Progressive Parties

Unaffordable housing erodes trust in government and boosts support for anti‑establishment parties. Surveys (Eurobarometer 2024, Gallup 2025) rank housing costs among the top concerns influencing voter behavior. Progressive parties that deliver affordable housing can rebuild coalitions of younger urban voters, renters, and aspiring owners.

European Outlook and Comparative Lessons

Countries with strong public housing (Austria, Denmark, Finland) and regulated finance show more resilient affordability metrics. In contrast, liberal markets like the UK and US exhibit higher price‑to‑income ratios and greater wealth concentration among owners. The brief emphasizes that policy choices—not market inevitabilities—determine outcomes, offering a roadmap for pan‑European sustainable housing strategies.