“Housing is a significant issue across numerous EU member states, and we are closely monitoring this as we work on how to address housing issues at the EU level,” stated Valdis Dombrovskis, European Commissioner for Economy, during an interview in Brussels with European media, including Lusa.
On the day the European Commission presented its autumn economic projections, the Commissioner highlighted that “housing access poses social and economic challenges,” prompting the European Commission to consider “how to support member states in resolving these issues at the EU level.”
On December 16, a European package on housing is set to be presented, which will encompass an EU affordable housing plan, a proposal to revise state aid rules applicable to services of general economic interest, a new European Bauhaus program, and a new housing construction strategy.
The autumn forecasts released today in Brussels indicate that “house prices in the EU have continued to rise, reinforcing the recovery initiated in 2024.”
In the second quarter of 2025, house prices in the EU were 5.4% higher than the same period the previous year (5.1% in the euro area), following quarterly increases of 1.4% in the first quarter of 2025 and 1.6% in the second quarter of 2025.
This price growth was more pronounced in Southern and Eastern Europe.
Portugal is among the countries experiencing double-digit annual growth rates, driven by strong demand and limited supply.
“Affordability pressures remain high as house prices have been rising faster than household incomes in many countries, particularly in urban centers,” warns the institution.
According to the European Commission, “supply constraints continue to be a significant factor in the housing market dynamics,” while “construction permits and completed dwellings are at historically low levels.”
Structural barriers, high construction costs, and regulatory obstacles are continuing to limit new supply, putting upward pressure on prices, the Commission acknowledges, predicting these limitations may persist into 2026-2027.
Due to the severe housing crisis in the EU, the European Commission plans to propose, by the end of 2025, a European Affordable Housing Plan aimed at complementing housing policies at national, regional, and local levels, while adhering to the principle of subsidiarity, as this jurisdiction belongs to member states.
The plan will include funding, state aid, and limits on short-term rentals.
The European Union is grappling with a housing crisis, notably in countries like Portugal, where house prices and rents have surged significantly, making affordable housing elusive, especially for young adults and low-income families.
It is estimated that over one in four people aged 15 to 29 in the EU live in overcrowded conditions, with many young Europeans leaving their parents’ home around or after 30 years old due to their inability to afford their own housing.
In 2023, approximately one in ten Europeans spent 40% or more of their income on housing and related costs.
