HAVET & VANHUFFEL – Association d’avocats
Europe – On 14 October 2025, the European Commission published a report entitled “Housing in the European Union: Market Developments, Underlying Drivers, and Policies.”
The document provides a comprehensive analysis of real estate dynamics in the 27 Member States of the European Union from economic, demographic, financial, and public policy perspectives.
According to the study, over the past decade, housing prices in the EU have increased on average 10% faster than incomes and, combined with the recent rise in mortgage interest rates, have reduced housing affordability. While rents for existing contracts have risen more slowly than housing prices, rents for new contracts have, on the other hand, surged.
The study reveals that price growth is largely linked to an insufficient housing supply, hindered by regulations, land scarcity, and low productivity in the construction sector. This shortage results from regulatory barriers, rising construction and land costs, inefficiencies in the construction sector, and labor shortages.
It sets out various policy options to mitigate this increase, such as reforms related to supply—investment in social housing, reform of land-use regulations, or improvements to infrastructure—which, according to the report, would be more effective in improving affordability than measures affecting demand, such as mortgage subsidies or tax deductions, which would tend to push prices up in the long term.
To access the report, follow the link : https://economy-finance.ec.europa.eu/publications/housing-european-union-market-developments-underlying-drivers-and-policies_en.