By Diana Yordanova, Communications Director at Housing Europe, one of EUSEW partner organisations
This opinion editorial is produced in co-operation with the European Sustainable Energy Week 2025. See ec.europa.eu/eusew for open calls.
As housing affordability pressures people living in Europe’s major cities, the EU Affordable Housing Initiative is shifting to another gear. In its second phase, 35 new lighthouse districts will be supported to become inclusive, energy-efficient, and sustainable spaces, with affordability at their core. Through tailored guidance, including financial advice, mentorship, and capacity-building, the programme addresses energy poverty, promotes inclusion, ensures affordability, and reduces emissions. Coordinated by Housing Europe alongside EBC, ECTP, Energy Cities, GNE Finance, and SINTEF, this EU-funded initiative sets a critical benchmark for the first European Affordable Housing Plan under the guidance of the new EU Commissioner for Energy and Housing.
Europe’s housing challenges we must tackle head-on
The European housing crisis shows no sign of slowing, with skyrocketing rents and a lack of affordable options pushing more families toward precarity. Residential property prices in the EU were 50% higher in Q3 2023 compared to the start of 2010, while rent prices rose by 23%, with some EU countries seeing increases of over 100%.Moreover, new economic and social realities have forced people who once would not have needed publicly supported housing to struggle on the private market. According to Housing Europe, 9.6 million full-time workers aged 25-34 were still living with their parents in 2022—one in five across the EU. At the same time, challenges facing the non-profit housing sector have grown significantly, prompting reports of long social housing waiting lists across most regions.
Learning from proven housing models instead of re-inventing the wheel
Unveiled as part of the EU’s Renovation Wave, the Affordable Housing Initiative wants to offer more than temporary relief for Europe’s struggling communities—it signals a need for a profound shift in how the continent addresses its housing crisis.
Moving beyond affordable retrofitting and energy efficiency, the Affordable Housing Initiative—funded by the Single Market Programme— focuses on building resilience, improving liveability, and building for longevity and resource reuse and efficiency. With a budget of around 1 million euros co-funded by the EU, this programme is on a mission to transform housing across communities and neighbourhoods. It offers practical, action-oriented advice drawn from successful case studies and fresh, innovative ideas. Participants will learn how to slash energy bills, tackle social inequality, and secure long-term affordability for homes through hands-on workshops, inspiring site visits, and dynamic online courses. It is a fast-paced journey toward more sustainable, inclusive housing that not only cuts emissions but also creates lasting change.
Phase I successes
To understand the impact of the Affordable Housing Initiative, one needs to look no further than the 22 districts supported over the past 2 years. They benefited from tailored training that linked energy efficiency with social inclusiveness. Public, cooperative, and social housing providers, SMEs, and cities were equipped with solutions for inclusive renovations, including three blueprints on financial feasibility, technology, and social inclusiveness. The initiative has also created a Funding Simulator which helps projects across Europe navigate public and private financing.
By spotlighting and scaling up proven housing models, the initiative establishes new standards—rooted in community well-being, sustainability, and innovation – and sets the stage for a more sustainable and equitable housing future.
Good examples are lurking everywhere
In the Basque Country, the Opengela project established two neighbourhood offices as One-Stop-Shops to guide residents through green energy renovations in Otxarkoaga and Txonta. Its innovative ‘MAS OPENGELA’ financing model, combining public and private funds, enables low-income households to secure 15-year loans, bridging the gap left by unaffordable bank loans.
ÖrebroBostäder was the first public housing provider in Sweden to include as a condition in the procurement the obligation to hire jobless inhabitants as construction workers for a limited period. In addition, the planning of the intervention aimed at fostering social cohesion in the neighbourhood.
Tallinn’s Mustamäe district tackled the challenges of multi-ownership with community meetings and showcasing local success stories. Technological solutions developed by Tallinn University of Technology, including modular and industrialised building systems, were piloted to modernise homes efficiently.
Resident co-creation underpinned a decade of revitalisation in Aalborg East (Denmark), led by the social housing provider, Himmerland Boligforening. With national financing frameworks and a cross-sector approach, the regeneration focused on improving quality of life, lowering crime rates and increasing education levels of residents turning a no-go area into a neighbourhood that has won multiple awards.
A truly equitable housing revolution is within reach
By 2050, the EU aspires to achieve climate neutrality, and the Affordable Housing Initiative is integral to that vision. Affordable housing districts can be an example that drives environmental progress while delivering transformative social returns. It is a clear challenge to governments and developers alike: a truly equitable housing revolution is within reach, but only if Europe learns from its own successes.
Recommended resources for further exploration:
Blueprints to create thriving districts
Handbook of best practices
Open call for the Affordable Housing Initiative Learning Programme
Author: Diana Yordanova, Communications Director at Housing Europe. Housing Europe is the European Federation of Public, Cooperative & Social Housing. Since 1988 it is a network of 45 national and regional federations, as well as 16 partnering organisations in 31 countries in Europe. Together they manage around 25 million homes, about 11% of existing dwellings in Europe.
Disclaimer: This article is a contribution from a partner. All rights reserved.
Neither the European Commission nor any person acting on behalf of the Commission is responsible for the use that might be made of the information in the article. The opinions expressed are those of the author(s) only and should not be considered as representative of the European Commission’s official position.
Source: Action Global Communications
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