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Kick start of the 2020 European Semester

Worrying signs of persistent housing divide

Brussels, 13 January 2020 | Published in Economy

The European Commission has launched the 2020 European Semester by providing a series of analyses about the state of the European economy and macroeconomic imbalances in the EU member states. As far as housing is concerned, it is the third year in a row that the same global picture is laid.

Amid an overall improvement on the economic situation in the EU (fall of unemployment, fall of poverty risk, increase income), strong price increases in some countries, in particular Ireland, Netherlands and Eastern European and Baltic countries continue along with sustained indebtedness of private households in relation to mortgage credit. Evidence of overvaluation, as measured by a growing valuations gap, has lately become stronger in countries such as Germany or Portugal. House prices are at or above peak levels since mid-2000s in a number of countries, including Austria, Belgium, Czechia, Germany, Luxembourg, Malta and Portugal.

In parallel, the number of homeless people continues to increase due to housing market circumstances realted to increases in property and rental prices, scarcity of affordable housing, changes in tenancy laws, limited or reduced public investment in public and/or social housing, cuts in housing allowances. But other adverse factors are also behind the rises in homelessness levels, including poverty, rising unemployment, inadequate and/or difficult access to support systems and services and rising immigration.

In conclusion, there is a sense of growing divide between the ones who have access to affordable housing and the ones who suffer from housing exclusion. The European Commission will look into more details of housing markets in the EU countries and will possibly address recommendations on housing policies for some of them.

Housing Europe members are therefore advised to contact the European Commission officials in charge of proposing the recommendations (see more information on this page).