Brussels has unveiled the EU’s first Affordable Housing Plan, a roadmap designed to improve access to housing for workers, young people and the homeless.
To tackle the current crisis, the EU plans to increase funding, encourage the release of vacant homes, introduce new rules on short-term rentals, promote workforce training and explore measures to curb speculation in the housing market.
As outlined by Denmark’s Commissioner for Energy and Housing, Dan Jørgensen, during his presentation to the European Parliament, the EU has opened “the pool of public aid so that Member States can use national funds to promote affordable housing.” To these national funds, “we are going to add European funds. We have already activated more than €43 billion for housing, but we will go further. Starting next year, we will offer funds for new investments,” including support via the Cohesion Fund and the European Investment Bank (EIB), in cooperation with national and regional development banks and other international financial institutions.
Among the measures planned for 2026 is a “new pan-European investment platform that will combine public and private funding for affordable housing,” Jørgensen highlighted. In addition, an extra €10 billion is expected to be mobilised over the next two years, allowing the 27 member states to reallocate cohesion funds toward housing initiatives.
The commissioner stressed that the EU needs “private investors who provide quality housing at fair prices. What we do not need are speculators who see housing prices in Europe not as a problem to solve, but as an opportunity to profit.”
To tackle this, “a comprehensive analysis of speculation in our housing market will be presented next year to propose corrective measures to address this crisis,” he added.
Beyond promoting new construction, another key strategy is bringing empty homes back onto the market by supporting their renovation and refurbishment.
“What we need is to ensure that not a single square metre of existing housing goes to waste. Twenty per cent of European homes are currently empty. So many people without homes, and so many homes without people. Addressing this issue is primarily the responsibility of national authorities, but Europe can play a role. We want to ensure that existing homes are used in the best possible way,” the Danish commissioner said.
Another measure announced is the promotion of worker training to tackle the widespread labour shortage in the EU construction sector. “We will also boost innovation through harmonised European standards and work with the industry to train three million construction workers annually by 2030,” the Danish official explained. Plans also include reallocating construction materials and skilled labour to regions where they are most needed.
On the legislative side, the affordable housing plan seeks to simplify housing regulations and introduce digital tools to reduce bureaucracy and accelerate new construction. Brussels estimates that an additional 650,000 homes will need to be built each year over the next decade.
The plan will also establish a new framework for short-term rentals, such as holiday rentals, whose expansion has reduced housing availability for residents in certain cities.
“While these rentals offer opportunities for many citizens, they also place pressure on the housing market. In some parts of Europe, one in five available homes is used for short-term accommodation. We cannot allow citizens to be forced out of their hometowns or the places where they wish to build their lives. Next year, we will present a new legislative proposal on short-term rentals. It will not be prohibitive; instead, housing-stressed areas will be defined so local authorities can promote affordable housing, with proportionate measures to mitigate the impact of short-term rentals,” the commissioner emphasised.
Brussels’ emergency plan also targets two groups most affected by the current crisis: young people and the homeless. “We are setting targets to support them and provide the necessary opportunities to (re)build their lives,” Jørgensen added.
The president of the Socialist parliamentary group, Iratxe García, welcomed the Commission’s initiative. “Housing is a fundamental right. In the EU, housing prices have risen by 60%, and rent by more than 30%. Sixty-two per cent of Europeans fear they will not be able to afford decent housing. We need massive investment in quality housing and, among other measures, steps to regulate short-term rentals.”
Meanwhile, Borja Giménez Larraz, an MEP from the People’s Party (PP), highlighted Europe’s housing supply crisis. “Four million homes are needed to meet demand. We need less bureaucracy and streamlined processes that do not block construction. Property rights must be strengthened, and at the same time, taxes should be reduced and incentives provided to encourage investment in residential properties.”
Nora Junco García, of the European Conservatives and Reformists Group, also urged a focus on strengthening legal certainty in housing and removing ideology from the market, rather than blaming tourist rentals or investment funds for the current situation. She highlighted that Spain alone needs more than 400,000 permanent homes, specifying “homes for families.”
Housing that is becoming increasingly expensive
According to Eurostat, housing prices across the European Union have soared 58% over the past decade, while in Spain the increase reaches 72%. The sharpest rises are seen in Hungary (237%), Portugal and Lithuania (147%), compared with the lowest in Finland (0.4%) and Italy (13%).
A report by the Council’s research department ranks Lisbon, Madrid and Barcelona among the cities where residents spend the highest share of their income on housing. In Lisbon, rent accounts for 116% of an average salary, while in Madrid and Barcelona it represents 74%. Milan, Rome and Dublin follow.
By contrast, in Paris the figure is 45%, and in Berlin around 40%. The lowest percentages are found in Luxembourg, Frankfurt and Vienna, where average spending ranges from 34–35%.
Two ways of looking at the same Housing plan
The Government applauds the plan and asks the Autonomous Communities to "take note"
The Ministry of Housing and Urban Agenda has welcomed the European Commission’s Affordable Housing Plan, urging other authorities – particularly regional administrations – to “take note” and use “all the tools at their disposal” to implement it, with a focus on the Housing Law.
According to the government, the European plan seeks to increase housing construction, strengthen regulation and provide greater subsidies. It also encourages member states to adopt measures to curb harmful speculative practices in the housing market, in line with recent calls from Prime Minister Pedro Sánchez.
The PP welcomes the plan: it "rebukes" Sánchez
The EU’s Affordable Housing Plan does not include rent caps or a common European fund, as requested by countries such as Spain – a point the People’s Party (PP) sees as a “rebuke” of the policies pursued by Pedro Sánchez’s government.
PP sources note that the plan promotes non-intervention in prices, increased housing construction and simplified regulations. They emphasise that the Commission aligns with the PP and its autonomous communities by avoiding rent controls, which they consider “ineffective and counterproductive.”
According to the party, Brussels’ plan focuses on accelerating housing construction, simplifying regulations, allocating funds to affordable housing and making decisions based on analysis and data rather than “ideology or propaganda,” in contrast to the Sánchez government.
The PP criticises the government’s record, noting that the Ministry of Housing left 68% of its budget unspent, turned down €4 billion in EU loans for social and affordable housing and created the “useless” public company Casa47, which will cost citizens €16 billion.
“The seven years Sánchez has been in Moncloa have only worsened housing supply and driven prices up by more than 50%. Squatting has increased by 54.7%, and the Bank of Spain estimates a shortfall of 700,000 homes in the country,” the main opposition party argued.
Clash in the Senate over the European plan
The Minister of Housing and Urban Agenda, Isabel Rodríguez, has accused the People’s Party (PP) of misleading Spaniards about the European Affordable Housing Plan, calling on them to show “rigour” in their statements.
Her comments came in response to PP senator Paloma Martín, who claimed in a Senate plenary session that the European Commission had criticised the government’s housing proposals and policies.
Martín stated: “The government’s housing policy, based on rental market intervention and price controls, has been deemed a failed strategy by the European Commission. It was flatly rejected because, rather than solving problems, market intervention worsens the housing crisis. Furthermore, the Commission noted that autonomous communities – particularly those governed by the People’s Party, which had not intervened in or controlled the rental market – have made sound decisions.”
The PP senator further accused the government of spending seven years “deceiving” Spaniards and of having “prostituted” housing, turning it into a “broken toy” of a government “in decay” and a “headache” for young people. “They have crossed every line of populism and propaganda,” she added.
In response, Isabel Rodríguez rejected the claims, emphasising that the European Housing Plan presented by the Commission is built on the three pillars the Ministry of Housing has long promoted: more affordable housing; stronger regulation, particularly in stressed areas, with measures such as those implemented in Spain through the European Single Registry; and increased support for vulnerable groups, including young people and families in need.
“You were only lying in your first statement,” Rodríguez stressed, noting that the European Commission also advocates coordinated action to address the housing crisis, which she described as “a social crisis,” and called for all levels of government to act to prevent speculation.
Housing, at the heart of European policy
Tackling the European housing crisis is a key priority in President von der Leyen’s policy agenda. With the appointment of the first Housing Commissioner in December 2024, the EU took on a greater role in supporting Member States, as well as regional and local authorities, in finding concrete solutions.
The commitment to more affordable and sustainable housing was reaffirmed in the 2025 State of the Union address. In October 2025, the European Council requested that the Commission present an “ambitious and comprehensive” plan to promote affordable housing across the 27 member states, marking the first major European framework to treat housing as a shared social and economic priority.