EU to ease rules on affordable housing funding

The European Commission plans to relax state aid rules and increase funding to address the bloc’s escalating housing crisis, according to Dan Jørgensen, the EU’s first Housing Commissioner.

Speaking to Euronews, Jørgensen said current regulations are “way too strict” and prevent member states from supporting affordable and social housing construction. The Commission will propose changes to enable faster, simpler state support under an EU Affordable Housing Plan expected in December.

Housing costs have surged across the bloc, with rents up 29% and home prices rising over 60% between 2010 and Q2 2025. Construction costs jumped 48% through 2023.

“People with normal jobs and normal incomes are no longer able to live in many cities,” Jørgensen said, noting the issue has driven protests from Lisbon to Copenhagen.

The plan will combine non-binding initiatives with legislative proposals, including a Construction Services Act and new rules on short-term rentals. By 2026, Brussels will introduce measures targeting platforms like Airbnb, which Jørgensen said have significantly inflated housing prices.

The Commissioner also flagged the “financialisation of the sector” as a concern, where housing is treated as a commodity by investors. “When that is the case, the investments being made don’t necessarily lead to the best result for society as a whole,” he said.

Until now, housing policy has been handled by national and local authorities. But with the issue dominating elections across Europe, Brussels now views it as requiring a coordinated European response.