Affordable Housing: Cohesion policy, Urban agenda and civil society

Key points

The EESC:

• believes that the housing affordability crisis represents not only a social challenge, but also a major economic threat to EU competitiveness, as businesses are facing wage pressures that are reducing their international competitiveness and contradict the cohesion policy objective of creating competitive regional economies;
• stresses that tackling the housing crisis requires not only more funds, but also smarter financing approaches. With the annual investment shortfall of EUR 270 billion identified by the European Investment Bank (EIB), the transfer of resources within the current cohesion policy allocations is clearly insufficient. In this regard, believes that cohesion policy should serve as the main framework for coordinating complementary instruments, mobilising public and private capital;
• welcomes the establishment by the Commission of the first Housing Task Force and a housing commissioner to develop a European Affordable Housing Plan. However, this working group should include representatives of Member States (MS), local authorities and social partners;
• supports the adoption of a comprehensive EU framework defining affordable housing throughout the process (social housing, affordable renting, affordable ownership) to provide legal certainty for investments;
• considers it essential that investments in affordable and sustainable housing should be a strategic priority for EU cohesion funds post-2027, through an approach that includes affordable housing in addition to social housing, while maintaining renovation measures;
• recognises the importance of an EU legislative framework to introduce and address the challenges posed by the housing crisis. This means addressing the EU regulatory failures highlighted by the rulings of the Court of Justice of the European Union (CJEU) that have constrained MS in funding social and affordable housing initiatives;
• welcomes the EU platform on affordable housing involving the EIB to leverage private investment on the ground and advisory services covering all phases of the project cycle and beyond;
• supports the proposal set out in the first report of the EP Committee on Regional Development (REGI) that loans, guarantees and own funds for affordable housing should not be considered as debt for states under the Stability and Growth Pact and the European Semester;
• considers that State aid rules and service of general economic interest (SGEI) definitions impose constraints on public investment in affordable housing beyond the narrowly defined social housing.
• believes that financial instruments that recycle returns for reinvestment can create sustainable financing mechanisms for housing beyond programme cycles;
• expects the next multiannual financial framework (MFF) to explicitly recognise housing as a factor in economic competitiveness and integrate it into the scope of the European Competitiveness Fund;
• believes that national and EU policies aimed at promoting economic growth through tourism or real estate development should take into account their potential impact on local housing markets;
• believes that the EC should take into account the experience and best practices of national, regional and local authorities committed to the development of affordable social housing across the EU;
• stresses that affordable housing must be seen as a cornerstone of the European social model.

Practical information

The EU Youth Test at the EESC was applied to this opinion. Youth Council of the Baltic Sea states was chosen by a group of interested youth organisations to represent all of them during the opinion-making process.