The lack of affordable and sustainable housing in Europe has moved to the top of Europe’s political agenda. On the back of strong demand and higher costs, house prices and rents have grown more strongly than income across the EU, leaving more and more people struggling to make ends meet, especially for those with low incomes.  

Urban areas are particularly affected: the shortage of housing in cities and suburbs has driven up prices to a level that makes it difficult even for middle-income families to find decent and affordable accommodation. As a result, an estimated 10% of Europe’s population have to spent more than 40% of their total disposable income, and many more close to that share. 

At the same time, housing is key to addressing climate change and achieving Europe’s plans to become climate-neutral by 2050. While buildings today account for 35% of greenhouse gas emissions in the EU, housing alone is responsible for about 20%. Reducing emissions from existing and ensuring climate standards are kept for new buildings is and will remain a priority.

Tackling these challenges requires massive increases in investment in new housing and renovation. Financing is one of the main cost items as well as a key lever to a solution that could help unleash the necessary construction wave across Europe.