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🏗️Trends in Residential Construction in Europe  

Recently, the European Union has seen rising costs and declining volumes in residential construction. At the same time, the topics of affordable social housing and the need for energy-efficient approaches are increasingly being discussed. These issues were addressed during the General Assembly of the European Construction Industry Federation (FIEC) on December 5, 2024. The discussion was moderated by Piero Petrucco, President of FIEC.  

The speakers included:  

🗣️ Luciana Tomozei Schwandt, Head of Division Global Affairs and Sectoral Policies, European Investment Bank (EIB)  

🗣️ Pau Garcia Audi, Team Leader in the 'Buildings Team' (DG ENER) European Commission  

According to EIB data, housing prices have risen by 1.5 times (+48.1%) across the EU since 2015. The highest increases were observed in Lisbon (Portugal), Dublin (Ireland), Valletta (Malta), Budapest (Hungary), and Sofia (Bulgaria). At the same time, as noted by Luciana Tomozei Schwandt, housing supply is failing to keep pace with demand—the need for new housing stands at 1.5 millions of units.  

Over the past decade, construction volumes have also decreased, and investments in public housing have declined. The gross value added in construction (2%) significantly lags behind the overall gross value added (9%) based on 2023 figures.  

The main reasons for the lack of investment in the construction sector include a shortage of skilled workers, high energy costs, and bureaucracy.  

Yes, the EIB allocates resources for financing and consultations to support residential construction. Specifically, it provides:  

🟡 Direct lending to local authorities and public institutions;  

🟡 Indirect lending through agencies, state, and commercial banks;  

🟡 Risk-sharing via guarantees and loan conditions;  

🟡 Advice on political, regulatory, technical, and financial matters;  

🟡 And more.  

The discussion also touched on assistance to Ukraine. According to the speaker, in 2024, the EIB allocated €400 million for the construction of municipal social housing in Ukraine and provided €4.2 billion in loans under the solidarity program for cities and regions hosting Ukrainians (e.g., Poland, Czechia).  

📜 Particular attention was given to current challenges in affordable housing. These include the absence of a common definition, regulatory uncertainty in EU competition law, limited public funding, difficulties in coordinating resources for financing, and the small scale of social and affordable housing providers.  

Pau Garcia Audi shared information about the European Commission's housing policy. Notably, active work is planned on the "Affordable Housing" initiative, which will have economic, social, and political impacts.  

It is crucial to ensure that affordable housing meets the needs of the population and is genuinely accessible in terms of purchase or rent, as well as maintenance and utility costs.  

Another area the European Commission will focus on in the near future is enhancing competitiveness and ensuring a level playing field, particularly in the housing construction sector.  

👉 Read more about the FIEC General Assembly at the link:  

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