Committee on Employment and Social Affairs (EMPL)

A Place To Call Home: With young people struggling to break into the housing market, an increasing number turn to private rentals where they face soaring prices and an insecure market filled with inadequacy problems, such as noise pollution and poor energy efficiency. Considering that those at risk of living in poverty are disproportionately affected, how can the EU ensure that young people have access to affordable, secure, and adequate housing? by Júlia Peña (ES)

Introduction

The housing market in the EU is undergoing a significant transformation, with a highly prevalent shift from homeownership to private rental. Between 2012 and 2020, homeownership decreased by over 3% in Member States, while private rental increased by over 9%. This transition has led to rising housing insecurity and adequacy problems, with average rent prices increasing by 19% between 2010-2023.

This poses a significant challenge for young people who, compared to the general population, are more likely to live in rental housing. In 2020, almost 28% of people aged 15-29 in the EU have been affected by overcrowded accommodation, with an even higher impact on those at risk of poverty¹, where 40.8% are also affected by the housing cost overburden. Youth homelessness is also on the rise in Europe, with people ages 18-29 making up 20-30% of the total number of homeless people in Member States.

The scarcity of social housing, insufficient wages, and unemployment further exacerbate this issue. Additionally, the migration of young individuals to urban areas in search of better opportunities has intensified the competition for housing. This leads to poor living conditions, with 6% of young people in the EU living in dwellings that, in addition to being overcrowded, also lack daylight, a bath or shower, or a proper roof.

Glossary

Energy poverty refers to a situation where households are unable to access essential energy services and products, such as heating, cooling, electricity and lighting.
Housing cost overburden occurs when the total housing costs (rent, energy, taxes, etc.) exceed 40% of the total disposable housing income.
Housing deprivation describes a dwelling which suffers one of the following conditions: leaking roof, damp walls, floors or foundation, rot in window frames or floor, lack of a bath or a shower, no flushing toilet or lack of natural daylight.
Overcrowded accommodation refers to a household that does not have at its disposal a minimum number of rooms equal to one room for every single person aged 18 or more.
Rent subsidies are a form of financial aid provided to individuals or households to make housing more affordable. These subsidies are designed to ensure that low- and very low-income individuals have access to suitable and affordable housing.
Social housing is accommodation targeted at people who can not afford to rent or buy a home, and is usually built with the support of government funding.
Under-occupied dwelling is housing that is deemed to be too large for the amount of people living in it, usually in terms of excess rooms.

Relevant Stakeholders

The European Commission collaborates with the Council of Europe in the EU Youth Strategy, the framework for European cooperation in the youth field for 2019-2027. It aims to create more equal opportunities for young people in education and the labour market, and to promote social inclusion. Moreover, it dictates the 11 European Youth Goals, which show in which areas change still has to happen so that young people in Europe can utilise their full potential.

The European Commission through a joint effort with the International Labour Organization (ILO) also manages the EU Youth Guarantee. It is a commitment by all Member States to ensure all young people under 30 receive a good quality offer of employment, apprenticeship or traineeship, focusing primarily on particularly vulnerable youth. It is implemented and coordinated at a national level.

Government and local authorities play a key role in ensuring the supply of affordable housing for youth. They are responsible for administering student housing, rent subsidies and grants, as well as monitoring and regulating housing policies. Member States are responsible for providing long-term financing for the development of affordable and secure housing for young people. These authorities often work in partnership with non-profit organisations, such as Housing First Europe and LIMOR, which provide affordable and suitable housing options for the youth.

The European youth is the social group which is most affected by soaring prices, an insecure market, and unemployment. Housing has been identified as one of the main concerns for young Europeans, as shown in Figure 1, as it is essential for the fulfilment of their life aspirations. Furthermore, young people are active participants in shaping and advocating for housing solutions that meet their needs.

Figure 1: Housing as one of the most important issues for young people in Europe.

Key Conflicts

Unemployment and poverty among the European youth are two of the key reasons for poor access to decent and affordable housing. A third of people aged 19-25 in Europe are living in poverty, stemming both from the financial crisis of 2008 and the COVID-19 pandemic. This not only affects the issue of housing but also employment: as of November 2023, 2.814 million young people under 25 were unemployed in the EU, which accounts for a 14.5% youth unemployment rate. Furthermore, young people are more likely to work in precarious jobs, which leads to 40.8% of young people being impacted by housing cost overburden. Poverty leads to poor housing conditions, such as overcrowded accommodation, lack of daylight, and insufficient basic amenities — resulting in approximately 42 million people across Europe, 9.3% of EU citizens, suffering from energy poverty. EU statistics for that matter are illustrated in Figure 2.

Figure 2: Overcrowding rate among European youth compared to the general population.

One topic related to housing crowding and sizes is the issue of under-occupied dwellings. In the EU, 34.8% of people are currently inhabiting a house that is deemed to be too large, in terms of excess rooms and more specifically bedrooms, for the needs of the occupant household, with a higher share of older people living in said dwelling. This is a sensitive topic as not many owners are willing to downsize their property due to the lack of attractive solutions. The situation with under-occupied dwellings in the EU can be seen in Figure 3.

Figure 3: Share of people living in under-occupied dwellings in the EU.

The scarcity of social housing has led to young people relying on the private housing market, which often does not effectively cater to their needs, in order to find rentals. Homeownership among young people is decreasing due to the scarcity of career-long positions, longer unemployment periods and increased earning inequality. This change is illustrated in Figure 4. Home prices have also increased during the past 60 years, particularly affecting low-income young people’s ability to afford mortgages. This has ultimately led to higher demands in the market, but not enough supply due to the transition to rental accommodations, making competition higher among tenants.

Figure 4: Distribution of population type by tenure in EU Member States.

The competition for affordable housing among inhabitants is further exacerbated by the influx of both national and international students into major cities to pursue their education. When it comes to international students, many countries are considering or implementing reductions in program sizes, especially English-taught programmes. Rural flight² also occurs with countries’ national students, with young people moving to bigger cities to pursue better education and find preferable career opportunities.

Furthermore, many popular destinations for students are also major tourist cities, for instance, Amsterdam, London, Paris, Barcelona, and Lisbon. These short-term rentals, which follow from tourism, pose an issue to people looking for long-term housing, ultimately reducing the residential housing supply and increasing housing prices.

Measures in Place

Many EU Member States provide financial aid in the form of housing allowances and rent subsidies based on income and housing costs to afford rents and energy bills. This aid is targeted especially at young people and families. Depending on the country, this money is distributed by the municipality (e.g. Hungary), regionally (e.g. Spain) or nationally (e.g. Finland). This aid aims to enhance resilience and social protection for vulnerable groups at risk of housing deprivation. In The Netherlands, for instance, the government contributes towards your rental cost through the Huurtoeslag, however, not all young people/students are entitled to it.

Furthermore, the subsidies’ capacity differs across and within countries, and these measures fail to reach everyone entitled to them. According to the Abbé Pierre Foundation, these subsidies are not enough to ensure quality housing for young people and they should instead be included in the European structural funds³ to improve the housing situation in the EU.

Although social housing is available in many EU countries, the degree of housing services greatly varies across the EU, as seen in Figure 5. The relative size of social housing stock has declined over the past decade in most EU countries, representing around 7% of the total housing stock on average. Moreover, there is no common definition of social housing at the EU level, which means that States adopt different definitions that translate into varying levels of public intervention within the sector.

Measures in Place

Figure 5: Percentage of social housing as part of the total housing in EU Member states.

Housing is a right recognised by EU legislation, with the Council of Europe addressing the issue of the right to housing in the European Social Charter⁴. Article 31 explicitly recognises the right to housing, binding States to: promote access to housing of an adequate standard; prevent and reduce homelessness with a view to its gradual elimination; and make the price of housing accessible to those without adequate resources.

Furthermore, the European Pillar of Social Rights⁵ despite not being a legally⁶ binding document, recognises that access to social housing or housing assistance of good quality should be provided for those in need, vulnerable people have the right to appropriate assistance and protection against forced eviction, and that adequate shelter and services shall be provided to the homeless to promote their social inclusion.

Key Questions

Should the housing crisis be approached through EU-wide legislation or should it be more adapted to each Member State’s context? Why?
How can policymakers best manage the potential increase in rent levels that can result from housing allowances and rent subsidies?
If it were up to you, would you rather build more social housing or tackle under-occupation in dwellings? Why?
When it comes to educational institutions that attract a lot of national and international students, should universities move to smaller cities, to counteract the effects of tourism and large populations in major cities? Think about arguments both for reasons why and why not.
Do you think youth poverty should be tackled through subsidies or the regulation of precarious jobs? Think about arguments for both options.

The European Union uses the relative definition of poverty as “people whose income and resources are much lower than the general standard of living in the place they live, limiting their participation in ordinary economic, social and cultural activities”. ↩︎
Rural flight is the migration of people from rural areas into urban areas. ↩︎
The European Structural Funds are the EU’s basic instruments for supporting social and economic development in Member States. ↩︎
The European Social Charter is a treaty that guarantees fundamental social and economic rights as a counterpart to the European Convention on Human Rights. It guarantees rights related to employment, housing, health, education, social protection and welfare. ↩︎
The European Pillar of Social Rights (EPSR) is a set of 20 principles and rights that aim to strengthen the social dimension of the EU and encourage Member States to update their social and employment standards and laws. ↩︎
Legally binding means that the principles and rights it encompasses are enforceable through national or EU courts, but it can be used as a guide of interpretation for social policies. ↩︎