Is a European Commissioner for Housing Good News?

In her speech to the European Parliament last week, Ursula von der Leyen identified housing access as a priority for the upcoming mandate: "People are struggling to find affordable housing. That is why, for the first time, I will appoint a Commissioner with direct responsibility for housing. We will develop a European Affordable Housing Plan." This announcement is promising but requires some clarification.

Housing as a European Priority

The first piece of good news is that housing is no longer just a concern for major cities and national governments; it has now become a priority for the European Union itself. A report from Housing Europe last year indicated that 47 million people in Europe are at risk of housing poverty, meaning their housing expenses (rent, utilities, and associated costs) exceed 40% of their household income. This crisis, particularly affecting large cities, stems from various factors: rising housing costs driven by speculative real estate investments, increased construction and energy costs without a proportional increase in incomes, and a decline in public investment in affordable housing alongside the surge in short-term rentals that has reduced the housing stock.

Thus, the elevation of housing issues on the European political agenda is indeed positive. Until now, the measures implemented by the Union in this area have been minimal, with national governments and local administrations acting independently and with little coordination. Apart from isolated initiatives with more symbolic than economic impact (such as the Urban Agenda's Housing Partnership Action Plan), coordinated housing policies are a relatively new development in Brussels.

However, there are several points of concern. 

First, the institutionalization of policies tends to create rigid, self-referential silos. This could be disastrous for finding effective solutions to affordable housing, given its interdependence with other complex social issues. Housing should not be viewed solely as a welfare infrastructure for social inclusion. Increasingly, policies addressing non-self-sufficiency, mental health, refugees, child protection, and protection from gender-based and sexual discrimination rely on providing new housing solutions. Beyond being a crucial component of reparative policies, housing can also drive social and economic development. While the benefits of integrating housing policies with environmental sustainability have been explored, recognizing that housing poverty often includes energy poverty, it is necessary to reconnect housing with three interdependent and nearly overlapping issues: employment, migration, and youth. Historically, public housing stock development was seen as an economic infrastructure serving development models, responding to the movement of (young) workers from other regions or countries. Reviving the systemic approach to housing policies and their connection to the labor market's development means addressing the housing needs of young people not just as university students but also in their transition to adulthood. This includes providing security and stability along with the flexibility and mobility that characterize contemporary work. According to Housing Europe estimates from Eurostat data, 9.6 million full-time workers aged 25 to 34 in Europe were still living with their parents in 2022. Therefore, a European Commissioner for Housing is welcome if they can work in an integrated, cross-cutting manner with economic development and social cohesion policies rather than in isolated silos.

A second point of concern regards the intervention strategy the new commissioner must implement. Methods to ensure housing access vary depending on contexts and diagnoses, often rooted in local situations. Likely, only a coordinated mix of interventions aimed at regulating the private residential market (including short-term rentals but not limited to these) and supporting both supply and demand, particularly for vulnerable populations, can achieve significant results. However, given the complexity of the issue, simplification must be avoided. A mixed investment plan involving public and private capital to increase housing stock is welcome, provided it considers at least three aspects.

First, housing pressure is most intense in large cities. Expanding metropolitan areas requires sustainable solutions to balance increased demand for public utility services, like water, electricity, transportation, and security. Being unprepared for these challenges could have critical consequences.

Second, increasing residential stock alone is not enough to reduce housing poverty. If affordable housing is to be ensured through private capital, the returns on investments in social housing projects (despite public interventions to lower private investment costs) cannot rely solely on rents without excluding economically vulnerable populations. Thus, all variables of the business model must be reconsidered: who pays, how much, for how long, and according to what principles of social and intergenerational inclusion. Various models exist (a study we are conducting under the Horizon project HouseInc is classifying them all), and potential trade-offs must be addressed.

Finally, there is the issue of wealth redistribution. Today, a young couple can legally rent a house costing more than 40% of their combined income but cannot secure a mortgage with a lower monthly payment without guarantees from a job market that no longer exists or from wealthy, not-too-old parents. When considering the expansion of housing stock—especially involving public resources—the ownership of the newly built properties must be addressed. While concentrating ownership in the hands of a few to support the social rental market might seem consistent with contemporary flexible housing ideas, it is crucial not to overlook that broad property ownership can once again become a tool for social mobility and wealth redistribution, as demonstrated by some first-home guarantee schemes.