The European Commissioner for Housing informed Euronews that the European Commission plans to address the housing crisis by focusing on investments, energy, social and internal market policies, alongside state aid regulations.

Dan Jørgensen, the inaugural European Commissioner for Housing, explained on Euronews’ principal interview program, The Europe Conversation, that Brussels aims to ease the “strict” state aid regulations and allocate EU funds to support member states in expanding affordable housing.

“These regulations dictate where governments can intervene to support constructing new affordable or social housing,” Jørgensen clarified.

“Given the current circumstances and the existing rules, they are excessively restrictive,” he continued. “Hence, there is a need for reform.”

Since the EU Treaty forbids state aid unless deemed essential for economic growth, Brussels intends to modify these rules, enabling member states to back affordable housing “more quickly and straightforwardly.”

Jørgensen pointed out that when engaging with local authorities across European cities, many highlight these “restrictive state aid regulations” as a significant obstacle.

“Some might question the EU’s involvement in member state matters, but this stems from the internal market framework. It is logical to establish limits on what assistance can be provided.”

This challenge will be addressed by the forthcoming EU Affordable Housing Plan, which the EU Executive is scheduled to unveil in December, aiming to complement national initiatives and facilitate member states in constructing affordable and social housing.

The strategy will likely include a combination of non-binding measures and legislative proposals, such as the Construction Services Act and updated regulations on short-term rentals.

A comprehensive strategy required

Between 2010 and the second quarter of 2025, rental prices rose by nearly 29%, while house prices escalated over 60% within the EU — increases that sparked demonstrations from Lisbon and Barcelona to Copenhagen, demanding improved living conditions.

Additionally, construction expenses surged by as much as 48% between 2010 and 2023.

“The crisis has reached a stage where individuals with typical jobs and incomes can no longer afford living in many urban areas due to the elevated costs,” Jørgensen emphasized.

“Although it would be preferable not to face a housing crisis, reality dictates otherwise, and therefore greater action is necessary,” the Danish Commissioner added.

Jørgensen acknowledged the multifaceted nature of the current housing crisis, highlighting the need for a “comprehensive” approach involving increasing the supply of affordable housing, investing in relevant sectors, and relaxing EU state aid regulations.

“Addressing housing issues requires consideration of investments, energy, social policies, internal market rules, and state aid,” Jørgensen stated. “Without acting on all these fronts, the problem will remain unresolved.”

Until recently, housing policy was exclusively managed by national, regional, and local authorities. However, with housing emerging as a critical electoral theme across the EU, Brussels now views it as a European challenge needing a European response, prompting the appointment of the first EU housing commissioner.

By 2026, Brussels also plans to introduce a new initiative to regulate short-term rentals such as Airbnb and Booking.com.

“Tourism generates benefits, but it becomes problematic when it adversely affects residents’ quality of life in these cities,” Jørgensen noted, highlighting how the growth of these platforms has significantly contributed to housing price increases.

The so-called “financialisation of the sector” will also be a key focus in Brussels’ agenda to combat the housing crisis, the European Commissioner stated. “There is considerable speculation, with many investors viewing housing purely as a commodity.”

“While profit-making is acceptable, it must be recognized that such investments may not always yield the best social outcomes,” Jørgensen concluded.

The complete interview will be broadcast on The Europe Conversation on Friday, 28 November at 17:30 CEST.