The EU's housing crisis

The document discusses the significant housing crisis facing the European Union, characterized by steeply rising house prices and escalating housing costs. It highlights the EU's ongoing efforts to develop a plan for more affordable housing. The information is published by the General Secretariat of the EU Council, which aims to provide insights into pressing issues affecting member states.

Since 2015, house prices in the EU have surged by up to 60% on average, with certain member states witnessing increases exceeding 200%. Concurrently, rent prices and energy costs have also risen, while household incomes have not kept pace. This disparity has left many Europeans struggling to manage their housing expenses, with approximately one in ten unable to pay their rent or mortgage on time. In major urban areas, the pressure is even greater, with one in ten urban residents allocating more than 40% of their income for housing.

Currently, housing consumes nearly one-fifth of the average EU household's income, presenting a substantial economic and social concern across the Union. The increasing unaffordability of apartments in major European city centers is alarming, with projections indicating that in 2025, some individuals may need to spend their entire salary on rent, making it exceptionally difficult for them to maintain financial stability.

Housing conditions vary considerably across the EU due to differing market dynamics, legal frameworks, and financial systems. Approximately two-thirds of Europeans own their homes, but this figure fluctuates widely among countries. For instance, over 90% of Romanians are homeowners, while in the Netherlands, homeownership is just above 10%. Moreover, reliance on subsidized rent varies greatly; over a fifth of the French population benefits from it, compared to a mere 0.6% in Sweden. These structural differences influence how countries respond to rising interest rates, demographic shifts, and urban demand, exacerbating the housing crisis.

With an urban population projected to reach 83% by 2050, housing pressures are expected to intensify, particularly in rapidly growing cities where availability and affordability are already strained. The imbalance between apartment and house living arrangements also highlights the disparity within member states, as 72% of urban residents live in apartments, while 82% of rural residents reside in houses.

Although housing policy is primarily a national responsibility, the EU recognizes the widespread implications of the crisis. Rising housing costs hinder labor mobility, limit access to jobs and education, and increase inequalities across regions and social groups. To address this, EU leaders have discussed the housing situation and tasked the European Commission with developing a plan for affordable housing to support member states. The plan is provisionally scheduled for publication in December 2025, focusing on financing, construction sustainability, planning, and social inclusion.

The Danish presidency has already outlined conclusions on the forthcoming plan, which have been endorsed by 26 member states. The EU's collective approach emphasizes the importance of addressing housing challenges through collaborative strategies, aiming to foster sustainable housing solutions across the region.