The European Union will mobilize approximately 430 billion euros ($450 billion) by 2029 to stabilize soaring housing prices and rents across the bloc. The move marks the EU's first pan-European real estate policy response as housing prices have surged more than 60% over the past decade, fueling housing insecurity across the continent.
The European Commission, the EU's executive body, announced on Wednesday a comprehensive housing initiative called the "Affordable Housing Plan" covering all member states. EU Executive Vice President Teresa Ribera emphasized the urgency, stating, "Affordable housing supply is one of Europe's most pressing challenges."
Under the plan, the EU estimates that 2 million housing units per year will be needed to meet demand, primarily in urban areas. The Commission plans to accelerate supply expansion by streamlining construction permit procedures and promoting investment in the housing sector.
The EU presented a blueprint to mobilize approximately 430 billion euros by 2029 by linking EU budget funds with financing from member states' financial institutions. The EU has already allocated 43 billion euros to the housing sector under its 2021-2027 long-term budget plan. The initiative calls for an additional 10 billion euros from InvestEU, the bloc's strategic investment fund, and 375 billion euros in investment from national and regional financial institutions by 2029.
The plan also includes tightening regulations on short-term rentals such as Airbnb. The Commission will propose new legislation on short-term rentals next year.
The EU's direct intervention in housing issues reflects concerns that housing instability threatens overall social stability across Europe. According to EU data, housing prices across the bloc have jumped more than 60% and rents have risen more than 20% over the past decade. Real estate policy has traditionally been handled individually by each member state, but the EU has determined that comprehensive action is unavoidable as rising housing prices across Europe are creating a structural crisis and eroding the bloc's competitiveness.
