On Tuesday 16 December in Strasbourg, the European Commission presented a long-awaited European plan to promote affordable housing, in an attempt to remedy the problems of housing shortages, speculation on the property market and overtourism (see EUROPE 13773/18).
For Energy and Housing Commissioner Dan Jørgensen, housing is a “fundamental right and housing prices have become a social crisis”.
And the EU has done “very little in recent years” to prevent this crisis, even though the new plan still fully recognises that “competences remain in the hands of the Member States and local and regional authorities”.
The Competition Commissioner, Teresa Ribera, who has been tasked with carrying out a targeted review of State aid rules to encourage investment in affordable housing, also insisted on the “key role of social housing”, which will remain unchanged. However, the Commission now wants to “target the middle class”, which is also finding it increasingly difficult to afford housing.
Among the tools presented, the Commission will therefore mobilise new investment in housing under the Multiannual Financial Framework, including €10 billion of additional investment estimated for 2026 and 2027 under InvestEU, and at least €1.5 billion from proposals by Member States and regions to reprogramme cohesion funds as part of the mid-term review. Additional support will also come from the Social Climate Fund for investments in energy efficiency, building renovation and clean heating and cooling systems.
The Commission has also already set up a Pan-European Investment Platform to mobilise resources from a broad coalition of financial players - including the EIB, the ECB, the EBRD and national and regional banks and promotional institutions - and increase investment in housing supply all across the EU.
In terms of the new building strategy, over the next decade around 650,000 homes a year will need to be added to current levels of new construction (around 1.6 million a year). It would cost around €150 billion a year to build these additional homes.
This includes uptake of “Modern Methods of Construction, supporting a shift to more circularity and digital processes, facilitating the cross-border provision of construction services (with a new law in 2026), and improving access to skilled labour”.
Red tape will also have to be cut with a new housing simplification package and working with “Member States, regions and cities to help them simplify building codes, administrative procedures on zoning, planning, permitting, and to increase their administrative capacity”.
Airbnb - towards a limit on overnight stays? As far as short-term rentals are concerned, the Commission could also decide on a limit to the number of nights that can be rented, according to a European official. Short-term rental booked via online platforms has grown rapidly by almost 93% between 2018 and 2024 and has become a significant business activity that can limit the supply of affordable housing for local residents in some areas, the Commission explains.
In very popular destinations, they can represent up to 20% of the housing stock. The regulation on short-term lettings, already applicable from May 2026, will bring greater transparency.
The proposed new legislation should complement this and support local authorities in taking targeted and proportionate action particularly in areas of housing stress and support sustainable tourism.
In a recent note on a sustainable tourism strategy seen by Agence Europe, the Spanish government asks the same thing: “Tourism policies must respect and enhance the quality of life of residents in all destinations. In some urban areas, the expansion of short-term rentals has exacerbated housing pressures, challenging social balance and local identity”, says Madrid. “Spain encourages the EU Strategy to consider residents as key beneficiaries of tourism policies, ensuring that destinations remain liveable and socially balanced”.
The plan also contains a social dimension that Commission Vice-President Roxana Mînzatu will be responsible for implementing.
In 2026, the Commission will be proposing to tackle homelessness with a new EU Council Recommendation on combating homelessness. It will also seek to alleviate the shortage of student accommodation.
Mixed reactions. “For the first time, the EU is recognising that housing is a major political issue. This is an important step. But given the scale of the crisis, this plan does not address the urgent social issues”, said Leïla Chaibi from France, speaking on behalf of The Left. “While housing has become a field for short-term speculation, the plan presented carefully avoids tackling the root causes of the crisis”.
For Marie Toussaint (Greens/EFA, French), the “plan marks the realisation that this problem, which affects all EU countries, requires a European solution. But without binding legal instruments at European level to reinforce the right to housing, this plan remains largely a declaration of intent”.
“This European plan is interesting, but it will not be enough to solve the housing crisis that is rife in many European countries, particularly in France. The EU provides tools, but it is up to each Member State to deploy its own strategy to increase supply, build, renovate and put vacant properties back on the market in areas where they are needed”, also declared Isabelle Le Callennec (EPP, French).
For the President of the European Committee of the Regions, Kata Tüttő, and the rapporteur on the Housing Plan, Jaume Collboni, Mayor of Barcelona, “the EU is taking a first step in full compliance with the principle of subsidiarity. More effective State aid rules and greater mobilisation of European funds can really help regional and local authorities to make affordable housing accessible to their citizens”.
“But if this work is to continue over the next decade, the EU’s next long-term budget must enable regions and cities to design and implement interventions that respond to the housing crisis”.
The association of mayors of European cities, Eurocities, has also hailed this as a turning point. “But it will only fully address this crisis if cities get the resources they need to build affordable and sustainable housing on the scale required, including direct funding from the EU, a real voice in policy making and stronger powers to regulate short-term lettings and curb speculative practices”.
“It is essential to significantly increase public investment in affordable and social housing. The revision of the EU’s State aid rules may help to unblock these investments, but public funds must be used for public benefit”, was the reaction from the European Trade Union Confederation.
Further information: https://aeur.eu/f/k10 ; https://aeur.eu/f/k11 (Original version in French by Solenn Paulic)