Housing affordability remains a significant concern across the European Union (EU) and the Western Balkans, with rising prices and rents impacting many households.
While both the EU and the Western Balkans face housing affordability issues, the Western Balkans experience higher financial burdens, greater overcrowding, and more significant energy inefficiencies. These challenges are exacerbated by economic disparities, slower implementation of energy efficiency measures, and limited access to affordable housing.
Housing Affordability in the EU
In 2023, 10.6% of urban households and 7% of rural households in the EU allocated more than 40% of their disposable income to housing costs, indicating affordability challenges. Notably, 31% of Greeks in urban areas faced this issue, compared to approximately 6% of Slovaks.
Between 2015 and 2023, EU house prices increased by an average of 48%, with Hungary experiencing a 173% rise and Finland a 5% increase. Contributing factors include higher building costs, increased mortgage rates, reduced construction limiting supply, and a surge in property investments for additional income.
Renting also became more expensive, with average rents rising by 18% from 2010 to 2022, partly due to the growth of short-term rentals removing properties from the market.
Housing Conditions in the Western Balkans
In the Western Balkans, housing affordability presents distinct challenges:
The financial burden of housing is significantly higher in the Western Balkans compared to the EU, particularly for those living in relative poverty. In 2019, 51% of individuals in relative poverty were behind on utility payments, and 32% were unable to keep their homes adequately warm.
In 2019, 55% of homes in the region were overcrowded, compared to the EU rate of 17%. Additionally, 27% of overcrowded homes lacked basic amenities such as indoor toilets or sufficient lighting.
Residential buildings in the Western Balkans are often poorly maintained and energy-inefficient, leading to high utility costs. The residential building sector consumes 30% to 60% of all final national energy consumption in these countries.
