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EU countries will be able to use up to €15 billion of the bloc’s regional development funds to tackle the housing crisis, the European Commission announced on Tuesday.
The move effectively doubles the amount of cash available for affordable housing investments within EU’s signature cohesion policy through 2027.
The announcement came during the mid-term review of the nearly €400 billion scheme, which the Commission created to reduce disparities between the bloc’s regions but now wants to use for priority issues like defense spending, competitiveness and housing.
Southern EU members like Italy and Spain, which have reacted coolly to repurposing cohesion funds for defense, are likely to be placated by the increased allocation for home-building. Soaring housing and rent prices have resulted in mass demonstrations in both countries and put politicians under pressure to expand affordable housing stock.
Energy and Housing Commissioner Dan Jørgensen told POLITICO that doubling the cohesion funds available for homes underscores Brussels’ commitment to taking on housing affordability.
“The housing crisis in Europe is one of the most pressing issues where our citizens expect fast action,” he said. “It’s an imperative for social cohesion and economic prosperity.”
Commission President Ursula von der Leyen has made the crisis, which is fueling support for far-right parties across the bloc, a priority issue for her second term. She first mentioned the possibility of increasing the cohesion funds earmarked for housing during her address to the European Parliament ahead of her reelection last summer.
The Commission is expected to unveil a plan to boost public and private investments in home-building later this year.
Gregorio Sorgi contributed reporting.
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