“Despite some improvements, the effectiveness of the social protection system in mitigating the risks of poverty and reducing inequalities remains low, and new challenges have emerged in the housing sector,” the Commission stated in a report on the social dimension and employment, released as part of the autumn package of the European Semester.

Specifically, according to Brussels, last year the proportion of the population with excessive housing burdens in Portugal was 6.9%, still below the EU average of 8.2%, but one of the largest increases in the European Union (EU), of two percentage points.

This is, therefore, “an indicator to be monitored,” says the institution, justifying it with “the continuous increase in housing prices and rents in recent years.”

Portugal is one of the EU countries that has been registering double-digit annual growth rates in house prices, driven by strong demand and limited supply.

Due to the acute housing crisis in the EU, the European Commission will present, in mid-December, a European Plan for Affordable Housing aimed at complementing housing policies at the national, regional and local levels, while maintaining the principle of subsidiarity, since this is a competence of the Member States.

The presentation of this European housing package is scheduled for December 16th, and includes an EU plan for affordable housing, a proposal to revise state aid rules relating to services of general economic interest, a new European Bauhaus program and a new strategy for housing construction.

The plan will thus include financing, state aid and limits on local accommodation.

The European Union is facing a housing crisis, in countries like Portugal, where house and rental prices have risen significantly, making affordable housing difficult to access, especially for young people and low-income families.

It is estimated that in the EU, more than one in four people aged 15 to 29 live in overcrowded conditions, with a large proportion of young Europeans leaving their parents' homes around or after the age of 30 because they cannot afford to buy their own home.

In 2023, around one in ten Europeans spent 40% or more of their income on housing and related costs.