The cost of living crisis threatens to escalate into housing crisis. Prevention is better than cure. Rising home prices cause despair around the world European Union. Many fear that they will be burdened financially. Others are homeless or live in substandard housing. Many young people cannot leave their parental home. In an upcoming Eurofound report on cost and access to roof in the countries of the Old Continent, private market tenants are particularly unreliable. Nearly half of those surveyed (46%) say they may have to move out of their home in the next three months because they can no longer afford it.

Private tenants also report problems with the quality of their housing, such as poor energy efficiency and lack of space, to a greater extent than landlords. residencesin particular, but also social/employment housing tenants. However, housing problems are not limited to private tenants. Homeowners with variable rate mortgages have to contend with rapidly rising interest rates and, more generally, the rising cost of living.

This is evidenced, for example, by Poland, where the Borrowers Fund to support holders mortgage loans with payment problems has seen an explosion in demand. The economic downturn will put these people at much greater risk. Even among those who bought their home without a mortgage, many struggle to cover other related costs, such as utility bills. In the EU, these are the sixteen states with the highest percentage of direct ownership, ranging from 38% in Portugal to 95% in Romania. Many of these owners are on the verge of poverty – from 8% in the Czech Republic to 24% in Estonia. In addition, many cannot keep their homes at an appropriate temperature due to low energy efficiency and financial constraints.

This applies to at least 15% in Bulgaria, Cyprus, Greece, Lithuania and Portugal. Compared to homeowners, social/workhouse tenants, on average, rate the quality of their housing as inferior and are more concerned that they may be forced to leave their homes. And they are more likely than private tenants to have difficulty paying utility bills.

Renters are particularly insecure, with owners facing rising interest rates.

Finally, while homelessness is declining in some countries (particularly Finland, which pioneered a housing-centric approach), the problem is getting worse in others. In Ireland, for example, the number of temporary accommodations is steadily increasing, from 7,991 units in May 2021 to 11,754 units in January 2023, with the risk of further increases once the pandemic-related eviction ban is lifted. More generally, the removal of cost-of-living measures poses a risk to the households that depend on them.

Finally, housing support is a difficult task, and measures to rent or buy housing can lead to an increase in rents and sales prices in general. Mortgage support disproportionately benefits those with higher incomes, who are more likely to buy a home, while encouraging some to take on debt they cannot repay.

* Mr. Hans Dubois is Director of Research at Eurofound in Dublin. Article published on socialeurope.eu.