Who's most affected by Europe's housing crisis?

Overview of the Report

The Euronews article, authored by Loredana Dumitru and Inês Trindade Pereira, examines the escalating housing crisis across Europe and its disproportionate impact on young people. Drawing on data from Eurofound, the European Commission, and Eurostat, the piece highlights rising property prices, rental costs, and the resulting socioeconomic challenges for the 18‑29 age group.

Rising Prices and Affordability Gaps

Since 2010, average house sale prices in the EU have surged by 55.4 percent, while rents have climbed 26.7 percent, outpacing income growth for many households. In Portugal, the European Commission estimated an overvaluation of about 25 percent above fair value at the end of 2025, making it one of the most over‑priced markets in the bloc.

Young People Hit Hardest

Young adults aged 18‑29 are especially vulnerable. Eurofound reports that they are more likely to fall behind on housing and utility payments and often resort to living with parents or relatives. This leads to overcrowded homes, particularly in urban areas where job opportunities concentrate but housing supply is scarce. In 2024, the highest overcrowding rates were recorded in Romania (41 %), Latvia (39 %), and Bulgaria (34 %). Conversely, Cyprus (2 %), Malta (4 %), and the Netherlands (5 %) reported the lowest rates.

Financial Strain on Independent Youth

Those young people who manage to live independently allocate a larger share of their income to housing and experience higher rates of cost‑burden compared with older age groups. This financial strain hampers their ability to pursue careers, achieve independent living, and delays family formation.

Investment Disparities Across the EU

Housing affordability varies widely. In Bulgaria, Ireland, Poland, Portugal, Spain, and parts of Austria and Italy, renting a standard two‑room apartment can require over 80 % of the median wage. EU‑wide, housing investment reached 5.3 % of GDP in 2024. Cyprus led with 8 % of its GDP, followed by Italy (6.8 %) and Germany (6.2 %). Poland invested the least at 2.2 %, with Latvia (2.5 %) and Greece (2.6 %) close behind.

EU Affordable Housing Plan

The European Commission’s first Affordable Housing Plan aims to curb speculative behavior and promote fairness in the residential market. The EU will allocate at least €11.5 billion from its multi‑annual budget, adding to the existing €43 billion commitment to social, affordable, and sustainable housing. National and regional banks are expected to contribute up to €375 billion by 2029.

Sustainable Housing Implications

The crisis underscores the need for sustainable housing solutions that balance affordability with environmental goals. Overcrowding and high cost‑burden can lead to poorer mental health and limit long‑term socioeconomic stability, highlighting the importance of coordinated European investment in green, affordable homes.

Key Takeaways for a Pan‑European Audience

• EU house prices ↑ 55.4 % and rents ↑ 26.7 % since 2010.
• Young adults (18‑29) face the greatest affordability challenges.
• Overcrowding peaks in Romania, Latvia, Bulgaria; lowest in Cyprus, Malta, Netherlands.
• Housing investment varies from 2.2 % to 8 % of GDP across member states.
• The EU’s Affordable Housing Plan mobilises €11.5 billion plus existing €43 billion, targeting sustainable, affordable housing solutions.