Access to affordable and decent housing in Europe is in an increasingly critical situation, particularly in Portugal (in regions such as Greater Lisbon, Greater Porto, Lower Alentejo, for example, shows a European Commission study on rents), southern Spain, the west coast of Italy and many regions in eastern Europe.
Faced with this, the Commission (EC) decided to move forward with a huge emergency plan to try to reverse or end the “crisis”, lowering house and rental prices and increasing construction and the supply of houses to buy and rent.
In total, it will be necessary to mobilize 150 billion euros per year, from now on, to heal the wounds of the European housing market, a process that could take ten years, says the same EC.
According to the new “European Affordable Housing Plan”revealed in Strasbourg (at the European Parliament), this Tuesday, the idea is to quickly respond to “the most pressing needs of European citizens: access to sustainable, good quality and affordable housing”.
This plan will be complemented by three others: the review of state aid rules (so that countries can better support the economy and companies without incurring competition law violations), the “European Housing Construction Strategy” to make the construction sector “more productive and innovative” and the New European Bauhaus. As a facilitator of the clean transition, innovation and bioeconomy, the “New European Bauhaus”, a framework to support “sustainable, affordable and high-quality projects”, all in the area of housing, as explained by the various European commissioners involved in this initiative.
For his part, Matthew Baldwin, the head of the team of experts on Housing, also from the European Commission, who developed the technical work for the commissioners to now present, states in a study that the plan to have affordable housing for everyone in Europe involves carrying a bazooka with public and private investment capacity of around 150 billion euros per yearthis is just to be able to deliver the houses that are missing.
According to the same group of experts, “currently we have built [na UE] around 1.6 million new housing units per year”, but by their accounts “around 650,000 additional units are needed per year over the next ten years”.
At a press conference in Strasbourg, Dan Jørgensen, Commissioner for Energy and Housing, said that “Europe must collectively take responsibility for the housing crisis affecting millions of our citizens and act accordingly”.
“It’s not just about the roofs over our heads: It’s our democracy that’s at stake. Because if we don’t resolve this issue, we risk leaving a void that extremist political forces will take over”, warned the Danish and social democrat official.
“This plan sets out concrete actions to make housing more affordable, triggering investment, regulating short-term rentals, reducing bureaucracy and supporting those most affected in our society. Because housing is not just a commodity. It is a fundamental right. We must mobilize every euro and do everything we can to ensure that, in Europe, everyone can afford a decent place to call their home,” added Jørgensen.
Portuguese regions at the top of the ranking of maximum rental stress
As part of this initiative, the EC presents several studies and in them Portugal emerges, unsurprisingly, as one of the countries currently experiencing maximum stress in terms of the rental market, for example.
One of these studies shows that Lisbon, Porto, Portalegre, Viana do Castelo and the entire Baixo Alentejo are among the European regions with the least affordable prices in new rental contracts.
In all these regions, this study shows, one third of families’ disposable income (the proportion that should be spent on housing, in a normal world) can only rent space measuring less than 30 square meters. Cubicles, basically.
Other countries appear in the same situation, especially regions of Eastern Europe, southern Spain, Greece and the Italian coast.
The EC notes that, currently, on average, Europe has “an average increase in house prices of more than 60% and in rents of more than 20% in the last ten years”.
“Millions of Europeans have difficulty finding a home they can afford” and “by harming labor mobility, access to education and the formation of families, the housing crisis is damaging the competitiveness of the European Union (EU) economy and our social cohesion”.
Build a lot more to bring prices down
In view of this, the European Commission says that it “will support Member States, regions and municipalities” and that “this plan focuses on increasing the supply of housing, activating investments and reforms, solving the problem of short-term rentals in areas under housing pressure and supporting those most affected”.
“The plan proposes measures for a more productive and innovative construction and renovation sector, which responds to the gap between supply and demand for housing through European Strategy for Housing Construction“.
“The package also includes a communication and a recommendation from the Council on the New European Bauhaus (NEB)”, a program “facilitating the transition to clean energy, innovation and the bioeconomy”, which will “support sustainable, affordable and high-quality projects, mainly in the built environment”.
But one of the most important pillars will be the relaxation of state aid rulesallowing governments to more easily support national companies or those that operated in their respective countries to the detriment of other non-resident companies. If these rules are not relaxed, governments could be accused and punished by the EC for illegally supporting companies, harming free European competition.
Thus, the EC promises to carry out a “review of EU state aid rules” in order to facilitate “Member States’ financial support for social and affordable housing”.
Brussels also says that it “will collaborate with national, regional and local authorities to simplify the rules and procedures that restrict the supply of housing, with special emphasis on planning and licensing” and will move forward, as mentioned, with “a new legislative initiative on short-term rentals that will support areas under housing pressure”, as explained in a statement.