Furthermore, it will contribute to reducing energy consumption in buildings, thereby lowering energy bills for consumers.
In this context, discussions are already underway regarding the potential exemption of government spending on affordable housing from fiscal rules.
To date, the EU has not had direct authority over housing policy, which has traditionally fallen within the remit of national and local authorities. However, the housing crisis has now emerged as a major political issue, prompting the European Commission to recognize it as a problem of European dimension that requires a coordinated solution. This recognition led to the establishment of the new position of Housing Commissioner.
“The crisis has reached a point where individuals with average incomes can no longer afford to live in many cities, as the cost has become prohibitive,” stated Housing Commissioner Jergensen. He emphasized the need for a “holistic” approach, including the expansion of affordable housing supply, facilitation of investment, and revision of state aid rules.
In 2024, housing costs in the EU exceeded 40% of disposable income—a critical threshold—for 9.8% of households in urban areas and 6.3% of households in rural areas.
Between 2010 and the second quarter of 2025, rents in the EU rose by nearly 29%, while house purchase prices increased by over 60%. Construction costs also escalated by up to 48% from 2010 to 2023. Between 2015 and 2024, the average increase in housing prices across the EU was 53%.
The situation is particularly acute in Greece, where more than one-quarter of urban households (29%) spent over 40% of their income on housing, and approximately 35.5% of household income was devoted to housing costs in 2024—the highest rate in the EU.
The forthcoming Affordable Housing Plan is intended to complement national policies and facilitate the development of new affordable and social housing.
The plan also seeks to unlock the potential of the construction sector, which comprises 3.2 million enterprises—99.9% of which are small and medium-sized enterprises, with 90% classified as very small businesses. The sector provides 23 million jobs and accounts for 10% of the EU’s gross value added.
