Executive summary

• Author: Zuzanna Kowalik - Piotr Lewandowski - Egidijus Barcevicius - Dovydas Caturianas - Jakub Sokolowski
• Pages: 7-8

Policies to e nsure access to aff ordable housing

7 PE 652.729

EXECUTIVE SUMMARY

Backgro und

Affo rdable ho using is bec oming a more d istinct field o f housing p olicy and decis ion-makin g in many

EU Member States. The EU has no direct competence over housing policy, but it can affect hous ing

condit ions in t he Member States in directly t hrough reg ulations, such as state aid law, fiscal law and

competition law and through "soft law" measures such as r ecommendations and guidelines.

Aim and methods

The main goals of this study are to:

• Prov ide a n in-depth overview of the housing situation in the EU, including its main trends and

challen ges by specif ying a reas in Eu rope e xperien cing par ticular difficu lties;

• Identify trends and best pr actice in affordable housing policies at Member State level; and

• Identify the main p olicies in relat ion to the a fforda bility of h ousin g at EU lev el a nd s p ec if y what

more can be do ne at EU and nation al levels in the futur e.

The analysis is based on desk-research (review of recent pu blications and statistical data),

supplemented by several interviews with key EU-lev el stakeholders in the field of housing policy.

Key findings

Ther e is a var iety of cr iteria fo r and d efinitions of ho using affo rdability use d across different Member

States and institutions. The most commonly used measure of housing affordability, however, is the

crite rion of h ousing price-to-income ratio: Eurostat defines th e housing cost overburden rate as the

share o f the population living in households that spend 40% or m ore of their equivalised disposable

income o n housin g. Between 2010 and 2018, the average housing cost overburden rate in the EU-27

countries remained st able at around 10% of populat ion. However, there are subst antial diff erences

between EU Member S tates in t erms of t he proportion of the population spending more t han

40% of their disposable income on housing. Wh ereas housing cost overburden is relatively low in

most Northern European and Central and Eastern European (CEE) countries, it is higher in Germany,

Denmark and Bulgaria, and is a particularly acute problem in Greece and some of the Balkan countries.

In recent year s, the position i n terms of ho using af fordability has deteriorated, i n particul ar

among low-incom e owners and private renters. In 2018, almos t 38% of h ousehold s at risk of poverty

spent mo re than 40% of their dispo sable income on housing, compared to 10.2% of the general

population in th e EU Member St ates. Housing cond itions/access to decent ho using for low-income

owners an d renters hav e also deteriorated in r ecent decades. In add ition, the absence of a singl e

widel y adopted definitio n of homel essness in the EU has made it difficul t to assess the extent of

homeles sness across the EU countries. The available data, however, indicates that rates of

homelessn ess have increased over the last decade in a n umber of EU cou ntries. The causes of such an

increa se ar e a co mbina tion of ris ing housing costs, t he impact of t he eco nomic crisis a nd, ove r the years

that followed, continued austerity-related measures, such as freezing or cutting social programmes or

benefits, as well as the inadeq uacy of policies to add ress homelessness in many Member S tates.

One of the key factors behind rising housing costs and the decreasing affordability of housing in Europe

is the so-called 'financialisation' of housing, which is generally defined as the transformation of

housing into a financial asset or commodity. The integration with and increasing dependence of

housing on the general finan cial mark ets, especi ally the f inanci al market s for mo rtgages has,