The European Commission has launched a sweeping Affordable Housing Plan aimed at addressing one of the most urgent concerns facing millions of EU citizens: the struggle to
secure a decent, reasonably priced home.
Over the past decade, house prices across Europe have risen by more than 60%, while rents have climbed over 20%. As a result, many Europeans find themselves priced out of the market. The Commission warns that the housing crisis is now undermining labour mobility, access to education, and family life—ultimately threatening both the EU’s economic competitiveness and its social fabric.
“This is a European challenge that requires a European response,” the Commission said, stressing the need for coordinated action while recognising that solutions must be rooted in local realities.
Boosting supply and cutting red tape
At the heart of the Affordable Housing Plan is a push to increase the supply of homes and reinvigorate the construction and renovation sector. The new European Strategy for Housing Construction is designed to boost productivity and innovation in the industry, narrowing the growing gap between demand and supply.
The package also highlights the role of the New European Bauhaus initiative, which supports sustainable, affordable and high-quality building projects. Through the NEB Academy, the EU will help train workers in circular and eco-friendly construction methods.
To support governments financially, the Commission will simplify state aid rules to make it easier for Member States to fund both social and affordable housing. Brussels also plans to work with national and local authorities to streamline planning and permitting rules that currently slow down new builds. A new legislative proposal targeting the short-term rental market aims to ease pressure in hotspots where tourist accommodation is crowding out long-term housing.
Major investment and a new EU platform
So far, the EU has channelled €43 billion into housing projects, and the Commission intends to maintain this level of investment under the next long-term budget. Plans are also underway to create a Pan-European Investment Platform together with the European Investment Bank and other financial partners to help bring forward new public and private funding.
The Commission says young people, students, essential workers and low-income households stand to benefit the most. New investment programmes will target student and social housing, and Member States will receive help to develop strategies to combat homelessness, especially through “Housing First” approaches that prioritise stable accommodation over temporary shelters.
Looking ahead
The Affordable Housing Plan marks the EU’s first comprehensive intervention in the housing sector. Implementation will be driven by a new European Housing Alliance, bringing together governments at all levels alongside housing experts, social organisations and industry representatives.
The Commission will publish a progress report before the end of its current mandate and has announced plans to host the EU’s first Housing Summit in 2026 to maintain political momentum.
Political context
Housing has become a central political priority for Brussels. The initiative follows the appointment of the EU’s first Commissioner for Housing in December 2025, and echoes commitments made by President Ursula von der Leyen in her 2025 State of the Union address.
The plan also responds to calls from the European Council for the Commission to design an ambitious strategy that respects national competences and subsidiarity. The proposal was developed in close collaboration with the European Parliament’s HOUS Committee.
By addressing both structural market problems and social needs, the EU hopes this landmark plan will pave the way for more affordable, sustainable and liveable communities across Europe.