Europe Recognises the Structural Housing Crisis and Validates the Basque Model as a Reference for the new European Affordable Housing Plan.

• The Basque Housing Observatory (OVV, standing for Observatorio Vasco de la Vivienda) publishes a new monograph analysing the plan recently launched by the European Commission, establishing parallels between the community text and the policies the Basque Country has developed for over a decade: the permanent classification of protected housing, the monitoring of the residential market, institutional governance and programmes such as Bizigune and Gaztelagun.

• Minister Denis Itxaso stated that the European diagnosis “endorses the reforms and innovations introduced by the Basque Country and opens new opportunities for alliances with the European Commission”.

Access to housing has become one of the primary structural challenges of the European Union. The sustained rise in prices, growing rental pressure in large cities and the shortage of affordable housing supply have created a scenario that can no longer be interpreted as a temporary phenomenon but as a profound transformation of the European residential market. This is the conclusion of the report “The European Affordable Housing Plan in the face of the housing emergency in the EU”, published today by the Basque Housing Observatory (OVV), which analyses the new framework promoted by the European Commission.

The document starts from a stark diagnosis: Europe is experiencing a housing access crisis unprecedented in recent decades. In numerous Member States, purchase and rental prices have grown far beyond the evolution of household income, while rising construction costs, land scarcity and insufficient production of affordable housing have limited market response. The result is a problem that transcends the social sphere to become a top-tier economic and demographic challenge. Difficulty in accessing affordable housing conditions labour mobility, hinders the emancipation of young people, increases territorial inequalities and affects the competitiveness of European urban economies.

Faced with this context, the European Commission has taken what the report describes as a political milestone in the community agenda: the launch of the first European Affordable Housing Plan. Although direct competence in housing remains with the Member States and regions, the European Union recognises for the first time the need to articulate a coordinated strategy to reinforce public policies and improve the institutional response to the rising cost of housing.

This new European framework proposes a combination of instruments including greater coordination between administrations, new European financial tools, structural reforms aimed at improving the functioning of the residential market, and monitoring mechanisms within the European Semester. For the Basque Minister for Housing and Urban Agenda, Denis Itxaso, this change represents explicit recognition of a reality that many European regions have been denouncing for years. “The new European Affordable Housing Plan confirms the path initiated by the Basque Country more than a decade ago, positioning housing as a strategic pillar for social cohesion, economic competitiveness and equality,” he stated.

The Pillars of the European Plan and the Basque Strategy

The analysis by the Observatory identifies four main pillars of action in the European strategy: boosting housing supply, mobilising investment, adopting structural reforms in the residential market, and reinforcing social protection for households with the greatest access difficulties. According to the report, these lines of action coincide broadly with the policies developed in the Basque Country. Both the Social Pact for Housing 2022-2026 and the Housing Master Plan 2025-2027 are precisely oriented towards expanding the public housing stock, improving system governance, reinforcing rental support programmes and accelerating the modernisation of the construction sector.

In this sense, Itxaso explained that 'the European approach coincides fully with the priorities the Basque Country has been developing for years'. He added that 'Europe proposes what Euskadi already applies: reinforcing the supply of protected housing, dynamising public and private investment, and improving governance and information systems’

Affordable Housing Supply: Key to Relieving Market Tension

One of the central aspects of the European diagnosis is the observation that insufficient affordable housing supply is the main factor explaining current market tensions, particularly in rentals. Therefore, the new community approach focuses on reinforcing the public housing stock, promoting intensive renovation of existing buildings, and facilitating land mobilisation for new residential developments. It also proposes accelerating the industrialisation of the construction sector to increase productive capacity and reduce costs.

These orientations align with the strategy the Basque Government has been developing for years to increase the availability of protected housing and establish a stable stock of affordable rental properties. “The picture in Europe is clear: the shortage of supply is putting pressure on the market” “And in terms of that structural response, Euskadi is now a valid reference,” stated the Minister.

The report further highlights that several solutions now proposed by the EU are already part of the Basque model of housing policy, which has been established over the last two decades. Notable among them is the sustained commitment to promoting protected housing, and specifically, the permanent classification of these homes since 2003, a measure that guarantees the public stock maintains its affordable character indefinitely.

Added to this are programs for mobilising empty housing, such as Bizigune; rental support initiatives for youth, such as Gaztelagun; a tax system oriented towards incentivising affordable rental; and a statistical and analysis system recognised as one of the most advanced in Europe, developed through the Basque Housing Observatory itself.

The document also identifies the Basque model’s institutional governance system, based on stable agreements between administrations, the participation of social agents, and permanent monitoring and evaluation mechanisms, as a differentiating feature. This approach, based on long-term institutional agreements, has made it possible to develop policies that are sustainable over time and to build a broad consensus on the right to housing. In the words of the Minister, this is a model that does not limit itself to applying isolated measures, but seeks to build a stable framework for public policy.

New Opportunities to Reinforce Housing Policies

The report concludes that the new European context opens relevant opportunities for territories like the Basque Country. These include the promotion of new investment platforms linked to the European Investment Bank, the possible reprogramming of European funds towards affordable housing projects, and the revision of State aid rules to favour social housing promotion.

European commitments expand the financial margin for public housing policies and accelerate construction and renovation projects in the coming years. “European commitments expand the financial margin to reinforce the Basque affordable rental stock and accelerate housing construction and renovation,” highlighted Itxaso, who confirmed that “The Basque Country is ready to lead the adaptation to the new European housing agenda”.