11 Million Vacant Homes and Europe Still Can't House Its People — The Real Problem the EU's First Housing Law Won't Touch

In March 2026, the European Parliament adopted a resolution addressing Europe's housing crisis, and the European Commission unveiled the European Affordable Housing Plan. This marked the first time in EU history that housing was treated as a standalone legislative domain. The core measures include regulating short-term rental platforms, penalizing speculative vacancy holding, and expanding social housing investment. The significance lies in the framing shift — elevating housing from a matter of personal responsibility to a social fundamental right. Yet France's experience offers a sobering precedent: despite enacting the DALO enforceable right-to-housing law in 2007, Paris rents have doubled since its passage.

Between 2010 and Q2 2025, average house prices across the EU surged by 60.5%, while rents rose by just 28.8%, according to official Eurostat data. This widening gap has given rise to Generation Rent — a structural phenomenon where the parental generation accumulated wealth through homeownership, but today's young adults face the prospect of renting for life. Eurofound data shows that the number of homeowners aged 30 to 34 fell by 26% between 2000 and 2015, dropping from 5 million to 3.7 million. This is not a uniquely European phenomenon — similar patterns are unfolding simultaneously in South Korea, Canada, Australia, and New Zealand.

Approximately 11 million homes sit vacant across the EU, yet 10.6% of the urban population spends more than 40% of their disposable income on housing costs. The root of this contradiction is the financialization of housing. Institutional investors like BlackRock and Vonovia have been acquiring residential properties at massive scale across major European cities — in Germany alone, institutional investors hold over one million housing units. The problem is not that there aren't enough homes — it's that the homes that exist are held by owners who have no interest in making them available at affordable prices.

The new EU regulations impose annual rental day caps and registration requirements on short-term rental platforms. Barcelona has pledged to phase out 10,000 tourist rental apartments by 2028, and Lisbon has declared a complete moratorium on new short-term rental registrations. However, Airbnb listings account for only 1 to 2 percent of total housing stock across the EU, making the framing of short-term rentals as the primary villain of the housing crisis arguably overblown. Regulation may deliver modest rent reductions of 5 to 10 percent in tourism-heavy cities, but it is a woefully insufficient instrument for addressing the systemic housing crisis.

The housing crisis is closer to a problem that lacks political will than one that lacks solutions. If house prices fall, existing homeowners — who constitute the majority of voters — revolt at the ballot box. If prices rise, young people bear the burden. No politician dares promise to actually bring prices down. The Vienna model demonstrates that solutions exist: the city government publicly operates roughly 60% of all housing. Yet the political will and fiscal capacity to replicate these models remain absent across most of Europe. Until this structural political dilemma is resolved, any legislation will carry a fundamental ceiling on its effectiveness.