RICS Position on the Future of Affordable Housing in Europe

Overview of the Position Paper

The Royal Institution of Chartered Surveyors (RICS), a leading global professional body for property, land, construction and sustainability, authored this position paper on affordable housing in Europe. Developed with contributions from over 20 members across Europe, the paper combines RICS expertise with research data to guide policymakers, developers and investors toward sustainable, affordable housing solutions.

European Housing Landscape

In 2023, 69 % of EU households owned their home, while 31 % rented. Germany is an exception, with 52 % renting. Affordability pressures are evident: 8.8 % of EU residents spent 40 % or more of disposable income on housing, the highest rates observed in Greece (28.5 %) and Denmark (15.4 %). Conversely, Cyprus (2.6 %) and Slovenia (3.7 %) reported the lowest burdens. Satisfaction levels differ, with 91.2 % of non‑at‑risk households satisfied with their homes versus 83.7 % of at‑risk households.

Definitions and Data Standards

The paper calls for a European housing data observatory under the EU Building Stock Observatory to harmonise data on tenure, affordability, demographics and renovation rates. Clear, shared definitions of “affordable housing,” “social housing,” and emerging typologies such as micro‑living and co‑living are recommended to improve comparability and policy implementation across Member States.

Technical Standards for Quality and Carbon

RICS promotes the International Cost Management Standard (ICMS) and the Whole Life Carbon Assessment (WLCA) as complementary frameworks for evaluating cost and carbon performance. Adoption of International Property Measurement Standards (IPMS) and RICS Global Valuation Standards (the “Red Book”) is urged to ensure consistent floor‑area measurements, valuation practices and transparency for investors.

Financing Mechanisms

Key barriers identified include limited capital access, regulatory uncertainty and low long‑term returns. Recommendations include: a stable EU‑wide subsidy scheme for predictable financing; expansion of green financing instruments such as Energy Efficient Mortgages (EEM); risk‑sharing mechanisms, tax incentives and low‑cost long‑term loans; and stronger legal obligations for developers to allocate affordable units. Public‑private partnership models and dedicated funding for social housing management are also highlighted.

Sustainable Construction and Innovation

Retrofitting existing stock is critical, as 85 % of Europe’s housing is already built. The paper cites Brussels’ conversion of 1.5 million m² of office space, noting limited affordable outcomes due to high conversion costs. It advocates modular, prefabricated and timber‑based construction to reduce material waste and whole‑life carbon, while stressing the need for updated regulations to enable micro‑living, co‑living and other innovative typologies. Energy‑efficient retrofits can cut building energy demand by up to 80 %.

Regulatory and Permitting Reforms

Planning delays are a major obstacle. The paper recommends fast‑track permitting for projects meeting affordability criteria, digitalisation of planning offices, and streamlined approval steps across jurisdictions. It also suggests mechanisms to convert underutilised or vacant buildings into affordable housing, strategic use of public land, and balanced policies supporting both ownership and rental models.

Labour and Skills Development

Construction labour shortages increase costs and slow delivery. EU‑wide retraining programmes, recognition of foreign qualifications and harmonised vocational standards are proposed to create a mobile, skilled workforce capable of supporting large‑scale retrofits and new builds.

Market Distortions and Tax Measures

Speculative activities, short‑term rentals and high mortgage rates exacerbate affordability gaps. Targeted mortgage schemes, taxation of long‑term vacant properties and regulation of short‑term rental platforms are suggested to protect long‑term supply and improve access for first‑time buyers.

Land Use and Supply Strategies

The paper emphasises strategic use of municipal and state‑owned land, modular construction to lower building costs, and the “filtering effect” of increased market‑rate supply to eventually free up existing stock for affordable units. Community land trusts are highlighted as a tool to separate land ownership from buildings, reducing speculation.

Conclusion

RICS concludes that sustainable, affordable housing in Europe requires coordinated financing, consistent data, clear definitions, modern construction methods and regulatory agility. By aligning social and climate objectives, leveraging public‑private partnerships and adopting unified standards, Europe can address current affordability pressures while meeting long‑term sustainability targets.