Housing affordability has become one of the increasingly important social and economic challenges facing the European Union. Although property prices and their growth dynamics have traditionally differed considerably
between EU member states, the widening gap between housing costs and household incomes is raising concerns about whether working people can realistically afford to buy their own homes. As the EU continues to develop a more coordinated approach to economic and social policy, ensuring fair opportunities to access decent and affordable housing is becoming an increasingly significant objective.
Recent Eurostat figures highlight the scale of the problem. In 2025, the EU's house price-to-income ratio was 6.8% higher than in 2015, indicating that property prices had increased faster than household incomes over the decade. However, developments across individual member states were far from uniform. The ratio increased in 17 EU countries, while the remaining 10 recorded a decline, demonstrating the considerable differences between national housing markets.
Portugal experienced the most significant deterioration in housing affordability, with its house price-to-income ratio increasing by 60.8% between 2015 and 2025. The Netherlands followed with an increase of 34.3%, while Hungary recorded a rise of 26.5%. Czechia and Spain also experienced substantial increases, at 25.8% and 24.5% respectively. These figures suggest that in several European countries, property prices have been rising considerably faster than household incomes, making home ownership increasingly difficult for ordinary employees and younger generations.
By contrast, some EU member states recorded improvements in the relationship between property prices and incomes. Romania experienced the largest decrease in the ratio, falling by 42.8% over the decade. Finland recorded a reduction of 25.2%, while Bulgaria saw a decline of 16.2%. Nevertheless, these changes do not necessarily mean that housing is cheaper in absolute terms in these countries. Rather, they indicate that property prices have developed more favourably relative to household incomes.
Another important indicator of housing market conditions is the standardised house price-to-income ratio, which measures how current housing affordability compares with its long-term average since 2000. Eurostat data identify two significant peaks in the EU housing market: 2007, immediately before the global financial crisis, and 2022. During these periods, the ratio stood 7.9% and 7.4% above its long-term average, respectively.
Following the 2022 peak, the indicator declined in both 2023 and 2024, suggesting some improvement in the relationship between property prices and household incomes. However, in 2025 it edged back above its long-term average, reaching 0.03%. This development indicates that, despite the recent adjustment, housing affordability remains a concern for European policymakers.
The European Commission also uses the standardised house price-to-income ratio as an auxiliary indicator within its Macroeconomic Imbalance Procedure. This allows policymakers to identify potential imbalances in national housing markets and assess risks that could affect broader economic stability.
However, the relationship between property prices and incomes represents only one aspect of the wider housing affordability challenge. Other important factors include the number of years of household income required to purchase a property, mortgage financing costs and the proportion of disposable income spent on ongoing housing expenses. Rising borrowing costs, limited housing supply and differences in construction activity can further complicate the situation, particularly in major European cities where demand for accommodation remains high.
For the European Union, the challenge is therefore not simply to encourage lower property prices, but to create conditions in which access to housing does not become an increasingly exclusive privilege. National governments retain primary responsibility for housing policy, but European cooperation can contribute through investment, financing mechanisms, social housing initiatives and the exchange of effective practices between member states.
Ultimately, affordable housing is closely connected with the EU's broader social and economic objectives. The ability of working people to purchase or rent decent accommodation influences labour mobility, family stability, demographic development and economic competitiveness. If housing costs continue to outpace incomes, the consequences could extend beyond the property market, increasing social inequalities and undermining confidence in Europe's economic opportunities.
The latest Eurostat figures demonstrate that there is no single housing affordability problem across the EU, but rather a collection of national challenges requiring different solutions. Nevertheless, ensuring that European citizens have fair opportunities to secure decent housing should remain an important part of the Union's evolving social and economic agenda.
