Europe’s housing crisis that was triggered by the 2008 financial meltdown is far from over and is getting worse in some places, a new report has
Europe’s housing crisis that was triggered by the 2008 financial meltdown is far from over and is getting worse in some places, a new report has claimed.
NGOHabitat for Humanity says in its wake will come major economic and social problems, says the report.
Its publication is timed to coincide with the third Europe Housing Forum meeting in Berlin that finishes on Friday.
The price of a European way of life keeps rising
Both groups seem to be coming to the same conclusion; for some Europeans, spiralling housing costs mean their continent is becoming too expensive for them to live in.
Every EU member has at least one “hotspot” city, whose economic dominance means everyone wants to live there for the jobs or client base it provides, and the education, health and leisure facilities. The top six overheated housing markets are Paris, Helsinki, Amsterdam, Luxembourg, London and Brussels.
However, these hotspot cities are also extremely attractive for another group – investors. Land is a finite resource, so the wealthy have twigged that property values in these places are never going to drop and are a sure thing where making money is concerned. This has skewed the housing market in these places, with plenty of housebuilding for the wealthy, who often buy property not to live in or let, but simply as an investment, but little or no “affordable” housing being built.
The hot money heads for London
London is the prime example of this trend. Sky-high rents mean more and more workers are forced to move further away from the centre to find lower rents or property values, if they are lucky enough to be able to buy. The result is low-paid but vital workers face daily commutes of an hour or two to get to work. Next time you are in a London hospital the nurse who is helping keep you alive may have been up at the crack of dawn to get the train before doing their 12-hour shift.
Habitat for Humanity says its report shows that housebuilding has slumped by between 70-90 percent across Europe, and that European social, or affordable housing, meets less than 10 percent of the market’s needs.
Go hungry, or go cold?
It goes on to claim that for 10 percent of Europeans, housing costs gobble up more than 50 percent of their income. In central and eastern Europe the situation in winter is catastrophic, with between 30-50 percent of people’s incomes being spent just to keep themselves warm.
The report also slams traditional house construction techniques and says new low-energy use units built using sustainable techniques that integrate new technology should be a priority for policymakers.
The property ladder keeps being pulled up
It also says that in some places it is not only the low-paid who are being forced out into the suburbs, but more and more skilled professionals. It is a phenomenon Habitat for Humanity calls the “new housing poverty”. For those seeking to buy, property values have risen so high in some places that is becoming impossible for anyone who is not already wealthy to scrape together the deposit needed to get a loan.
So much for the economics, but the NGO has more. It also found that more and more young people are staying at home with their parents because they cannot afford to move out. For the 18-34 age group, it is reaching record highs; 55 percent in Portugal, 74 percent in Slovenia, for example. The social tensions and pressures this enforced generational cohabitation could generate are enormous.
Decent housing is a basic human right and a core responsibility of government. The report says there should be a lot more public and private investment in housing, and calls for new funding and lending options to make these homes more affordable.
“Europe needs to look at better ways of developing and providing housing that helps people, regardless of class or income, to have a decent place to live,” according to Greg Foster, the Europe, Middle East and Africa manager of Habitat for Humanity.
“And the trends and threats to Europe’s middle- and low-income neighbourhoods need to be analysed and solutions developed, to ensure the region’s cities remain liveable for everyone”.